The central institution through which a laissez-faire system answers the basic economic questions is the
A. tribal council.
B. market.
C. government.
D. central planning body.
B. market.
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If penalties are imposed on the sellers of illegal goods or services, then the equilibrium price ________ and the equilibrium quantity ________
A) rises; increases B) rises; decreases C) falls; increases D) falls; decreases
Which of the following is NOT part of solving a game?
A) Write down all possible combinations of strategies. B) Write down all possible payoffs and eliminate dominated strategies. C) Solve for any Nash Equilibrium. D) None of the above.
A concentration ratio gives
A) the average size of the firms in an industry. B) the total sales of four or eight of the mid-sized firms in the industry. C) the percentage of all sales contributed by the four or eight largest firms in the industry. D) the sales of the four largest firms in the industry divided by the sales of the eight largest firms in the industry.
Which of the following is true of the aggregate supply curve?
a. It shows the inverse relationship between prices and national output. b. It shows the positive relationship between the price level and the supply of all goods produced in the economy. c. It shows the amount of real GDP consumed at different price levels. d. It is a negatively sloped curve that shows the relationship between the price level and the cost of production of firms in the economy. e. It shows the positive relationship between price and quantity supplied of an individual good.