The game between music stores in the figure shows us that:
This figure displays the choices and payoffs (company profits) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a profit at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes.
A. only The Rock Shop has a dominant strategy, and so the outcome cannot be predicted.
B. only MiiTunes has a dominant strategy, and so the outcome cannot be predicted.
C. neither store has a dominant strategy, and so the outcome cannot be predicted.
D. None of these statements is true.
D. None of these statements is true.
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Which of the following statement or statements are correct about potential GDP?
i. Actual real GDP equals potential GDP when the economy is at full employment. ii. Real GDP can be less than potential GDP. iii. When real GDP equals potential GDP, it also equals nominal GDP. A) i only B) ii only C) ii and iii D) i and ii E) i, ii, and iii
Comment on the following statement: "Capital investment decisions always involve risk."
What will be an ideal response?
Which phrase finishes this statement best? The net effect of a union increasing wages
A. is to lower non-union wages by an offsetting amount so national income is not changed. B. is that no one gains in the end since union shops cannot compete and do not survive. C. is to misallocate labor toward non-union work unless unionization enhances union worker productivity by its actions. D. is to increase wages in both union and non-union sectors.
If a consumer is at an optimum, consuming A and B, and the price of B decreases, then to get to a new equilibrium the consumer must
A. purchase more A. B. purchase less A. C. purchase more of both A and B. D. purchase less B.