The firms in the petroleum industry of Oiland have decided to cooperate with each other by setting their respective market shares. This is an example of ________ in the petroleum industry
A) cost cutting
B) undercutting
C) collusion
D) free riding
C
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If the cross-price elasticity of demand between two goods is -1.2, then the two goods are:
A. substitutes. B. complements. C. inferior. D. elastically demanded.
In the figure above, the SLF curve is the supply of loanable funds curve and the PSLF curve is the private supply of loanable funds curve. If there is no Ricardo-Barro effect and the government now runs a balanced budget,
A) the interest rate will increase from 4 percent to 6 percent. B) there is a surplus of investment funds and the interest rate falls to 4 percent. C) there is shortage of investment funds of $0.4 trillion. D) the equilibrium interest rate is 6 percent and investment is $1.6 trillion. E) the equilibrium interest rate is 4 percent and investment is $1.8 trillion.
Assume a market price gets set artificially low-that is, it gets set below the equilibrium price. This change means:
A. Every producer loses surplus, and it all gets transferred to consumers. B. Some producers drop out of the market, and those left lose some surplus. C. Every consumer gains surplus, due to the lower price now being charged. D. None of these is true.
Competition is present when
A) subsidies assure that inefficient firms remain active in the market. B) there is little incentive to introduce new products and discover better ways of doing things. C) the market is characterized by rising prices and declining product quality. D) freedom of entry and rival firms are present in a market.