Most cartels cease to be effective because:
A. of the incentive to cheat on the cartel agreement.
B. the dominant firm buys out the other firms.
C. of strict enforcement of antitrust legislation.
D. consumers discover the cartel and buy from other firms instead.
Answer: A
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Refer to the graph shown. If this monopolist were allowed to choose the profit-maximizing level of output, it would produce:
A. 400 units of output. B. 800 units of output. C. 500 units of output. D. 300 units of output.
The trade model described in the text demonstrates that countries can expand consumption by specializing in the production of goods and services in which they have a comparative advantage. In reality we do not see complete specialization in production
State three reasons why this is case. What will be an ideal response?
If the long-run Phillips curve is vertical, then any government policy designed to lower
a. unemployment will not change the unemployment rate but it will increase the inflation rate b. unemployment will lower it but also will lower the inflation rate c. inflation will cause employment to rise d. unemployment will not lower it and will end up raising the rate of inflation e. unemployment will be effective but it will also cause the inflation rate to rise
The rent earned on marginal land is
a. zero. b. the average of all qualities of land. c. above the average of all qualities of land. d. below the average of all qualities of land.