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.According to the figure, The Rock Shop:
A. does not have a dominant strategy.
B. has more than one dominant strategy.
C. should enter the market, regardless of what MiiTunes chooses to do.
D. should not enter the market, regardless of what MiiTunes chooses to do.
Answer: A
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Over the past fifty years, there has been substantial closure of the gap in real GDP per person between which of the following groups of countries?
A) the United States and Central and South America B) Africa and Western Europe C) Central and South America and Africa D) the United States and Japan
Charles Murray would
A. provide government jobs for everyone who is ready, willing, and able to work. B. scrap the entire federal welfare and income-support structure for working-aged persons. C. introduce the negative income tax. D. do none of these things.
Entry of new firms in a decreasing-cost industry leads to an upward shift of the LRAC curve.
Answer the following statement true (T) or false (F)
The adoption of inflation targeting in the United States ________
A) brought an end to the "dual mandate" regime B) resulted from legislation enacted in 1914 C) occurred after its adoption in more than a dozen other countries D) was blocked by its staunch opponent, Ben Bernanke