All of the following are true regarding a long-term contract between an upstream firm and a downstream firm except which one?
A) The downstream firm can incur opportunity costs.
B) The upstream firm can incur opportunity costs.
C) Both firms have increased flexibility.
D) Changes in market conditions can impose new costs to either firm.
C) Both firms have increased flexibility.
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Figure 10-5
In Figure 10-5, which graph best illustrates the situation of an economy reacting to a recessionary gap by reducing resource cost levels?
A. (1) B. (2) C. (3) D. (4)
Which of the following is an accurate statement about perfectly competitive markets?
a. They have numerous small suppliers. b. They have a few large suppliers. c. They have few small suppliers. d. They have about the same number of small and large suppliers.
The low-rate loans that are to be repaid within ten years seem to be a form of ________ as they shift the International Monetary Fund to a role as a development organization.
A. mission creep B. tequila effect C. stand-by arrangements D. moral hazard
In the above table, if the marginal revenue product is $26, how many workers will the profit maximizing monopsonist hire and what wage will they pay each worker?
A. 5; $16 B. 6; $30 C. 4; $16 D. 5; $18