The outcome of a colluding oligopoly:
A. is more efficient than that of a competitive oligopoly.
B. is the same as that of a monopolist.
C. is less efficient than that of a monopolist.
D. is more efficient than that of a monopolist.
Answer: B
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Economic models are NOT used to
A) explain economic phenomena. B) predict economic phenomena. C) understand economic phenomena. D) describe all economic phenomena in minute detail.
Refer to the diagram, in which Q f is the full-employment output. An expansionary fiscal policy would be most appropriate if the economy's present aggregate demand curve were at:
A. AD 0 .
B. AD 1 .
C. AD 2 .
D. AD 3 .
Refer to Figure 9.2. A movement from point d to point b could be caused by a(n)
A) increase in government spending. B) increase in the price of oil. C) increase in taxes. D) decrease in short-run aggregate supply.
Why is the advent of monopoly likely to shift cost curves?