The success of a predatory pricing strategy in an oligopolistic market depends on all of the following except:
A) the number of firms operating in the industry prior to enactment of the policy.
B) how far the predatory price is below cost.
C) the period of time for which the predatory price is in effect.
D) the length of time over which recoupment of profits occurs.
A
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The principal danger to Japan in 2001 when the yen was appreciating was that this would
A. increase aggregate demand and make inflation worse. B. decrease aggregate demand and make the recession worse. C. decrease aggregate demand and make inflation worse. D. increase aggregate demand and make the recession worse.
A price floor in a perfectly competitive market
a. is efficient b. is a Pareto improvement c. is effective only if it is set below the equilibrium price d. transfers some surplus from consumers to producers e. transfers some surplus from producers to consumers
Suppose a Starbucks tall latte costs $4.00 in the United States and 3.20 euros in the Euro area. Also, suppose a McDonald's Big Mac costs $4.40 in the United States and 5.50 euros in Euro area. If the nominal exchange rate is .80 euros per dollar, the prices of which goods have prices that are consistent with purchasing-power parity?
a. both the tall latte and the Big Mac b. the tall latte but not the Big Mac c. the Big Mac but not the tall latte d. neither the tall latte nor the Big Mac
Using the figure above, which of the following statements is (are) correct?
i. MR = MC when 3 haircuts are produced. ii. If the firm charges each customer the same price for a haircut, the price of a haircut is $42. iii. The firm's MC equals $30. A) i only B) ii only C) i and ii D) i and iii E) None of the above is correct.