A network effect exists whenever
A. a firm's willingness to purchase a particular factor of production depends on the other types of inputs it utilizes to manufacture an item.
B. a consumer?s willingness to purchase a particular good or service is influenced by how many others also buy or have bought the item.
C. a consumer's willingness to purchase a particular good or service is influenced by the prices of other complementary or substitute items.
D. a firm's willingness to produce a particular good or service is influenced by the costs of inputs it must utilize in order to manufacture the item.
Answer: B
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Player 1 and Player 2 are playing a game in which Player 1 has the first move at A in the decision tree shown below. Once Player 1 has chosen either Up or Down, Player 2, who can see what Player 1 has chosen, must choose Up or Down at B or C. Both players know the payoffs at the end of each branch. 
If Player 2 could make a credible commitment to choose either Up or Down when his or her turn came, then what would Player 2 do?
A. Player 2 would commit to choosing Down. B. Player 2 would commit to choosing Up. C. Player 2 would not commit to choosing either strategy. D. Player 2 would commit to mimicking Player 1's strategy.
If the market price in a competitive market is below the minimum of average variable cost, the firm will shut down
Indicate whether the statement is true or false
If the quantity supplied of a product is less than the quantity demanded, then:
a. There is a surplus of the product b. There is a shortage of the product c. The product is an inferior good d. The product is a normal good
Under both perfect competition and monopoly, a firm:
A. is a price taker. B. is a price maker. C. will shut down in the short-run if price falls short of average total cost. D. sets marginal cost equal to marginal revenue.