If there are 2 identical firms in a market that choose the quantity they produce, total welfare is the highest when there is a cartel
Indicate whether the statement is true or false
False. A cartel acts like a "virtual" monopoly and thus produces the least output. Output is the greatest if the 2 firms act as a Stackelberg Oligopoly which is therefore preferred.
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“Supply creates its own demand” is an expression of
a. the quantity theory of money. b. monetarism. c. Say’s Law. d. the Keynesian critique of classical economics.
Trade can benefit everyone in society because it allows people to specialize in activities in which they have a comparative advantage
a. True b. False Indicate whether the statement is true or false
The midpoint method is used to compute elasticity because it
a. automatically computes a positive number instead of a negative number. b. results in an elasticity that is the same as the slope of the demand curve. c. gives the same answer regardless of the direction of change. d. automatically rounds quantities to the nearest whole unit.
Which of the four criteria for an ideal voting system is demonstrated when everyone in a town prefers spending on improved public transportation systems instead of public parks, and transportation spending wins?
A. No dictator B. Unanimity C. Independence of irrelevant alternatives D. Transitivity