There are only two firms in an industry with demand curves q1 = 30 - P and q2 = 30 - P. Both have no fixed costs and each has a marginal cost of 10 per unit produced. If they behave as profit-maximizing price takers, each produces 20 units and sells them at a price of 10 so that each firm makes zero economic profits. If they formed a cartel, the profit-maximizing price is
A) 10.
B) 15.
C) 20.
D) 25.
C
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When maximizing economic growth is a country's goal it:
A. may work in opposition to the country's happiness in terms of satisfaction gained from leisure. B. increases the correlation to the country's happiness, because more money makes people happier. C. creates a perfect correlation to happiness, if the money is allocated fairly. D. everyone in the economy will be better off if it obtains its goal.
Economists refer to externalities as an example of market failure when:
a. markets do not consider social costs as part of overall costs. b. additional external costs are so high that the firm must shut down. c. private costs are the same as costs to society as a whole. d. citizens bring lawsuits to stop production that pollutes.
Which of the following would be counted as investment in the national income accounts?
a. the purchase of a newly issued stock b. the purchase of a newly built apartment house c. the purchase of a newly minted coin d. the payment of tuition at a private college
If an asset has a future value of $120, a present value of $30, and an interest rate of 4%, how many periods of compounding are there?
A) 45 periods B) 35 periods C) 28 periods D) 100 periods