The dilemma in a prisoner's dilemma is that:
A. the players would be better off if they both played a dominated strategy.
B. the outcome is random, so players are uncertain about which strategy to play.
C. only one player has a dominant strategy, but the other player is uncertain about what to do.
D. the players may be trapped in a game they don't know how to play.
Answer: A
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Monopolies can make an economic profit in the long run because there
A) are close substitutes for the product. B) is free entry and exit. C) is inelastic demand from consumers. D) is a barrier to entry.
Explain why a subsidy is inefficient
What will be an ideal response?
Which of the following statements is a defining feature of a corporation?
a. The owners of a corporation face unlimited liability on debts. b. A corporation owns and operates units only in foreign countries. c. A corporation is created by a verbal agreement. d. A corporation that is based on a verbal agreement is also recognized by State law. e. A corporation has a legal identity that is separate from that of its owners.
During the German hyperinflation after World War I, transactions costs skyrocketed. As a result, not surprisingly, output
A) increased dramatically. B) grew at a much smaller pace than prior to the war. C) did not change. D) declined sharply.