If a firm is producing at the kink in its demand curve and it decides to decrease its price, according to the kinked demand model
A. It will lose market share, but its profits will decrease.
B. It will gain market share.
C. It will lose market share to the firms that do not follow the price decrease.
D. Its market share will not be affected.
Answer: D
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Based on the figure below. Starting from long-run equilibrium at point C, a tax cut that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies. 
A. D; C B. B; C C. B; A D. D; B
In a perfectly competitive market, if market price is lower than the average total cost of production:
A) new firms will enter the market. B) existing firms will leave the market. C) all existing firms will earn positive economic profits. D) all existing firms will earn zero economic profits.
In the binary dependent variable model, a predicted value of 0.6 means that
A) the most likely value the dependent variable will take on is 60 percent. B) given the values for the explanatory variables, there is a 60 percent probability that the dependent variable will equal one. C) the model makes little sense, since the dependent variable can only be 0 or 1. D) given the values for the explanatory variables, there is a 40 percent probability that the dependent variable will equal one.
In a Crown colony
a. both its governor and upper house were appointed by the Crown. b. the governor was appointed by the Crown while the upper house was elected by the propertied adult males within the colony. c. only the lower house could initiate fiscal legislation. d. Both a and b are correct. e. Both a and c are correct.