If two or more markets are closely related,
A) a partial equilibrium analysis will tend to overstate the price impact of a supply shock.
B) a partial equilibrium analysis will tend to accurately predict the price impact of a supply shock.
C) a partial equilibrium analysis will tend to understate the price impact of a supply shock.
D) they should be analyzed concurrently but using partial equilibrium analysis alone.
C
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If a firm in a perfectly competitive industry experiences persistent losses, in the long run it should
A) shut down temporarily and wait for market conditions to change. B) continue to operate if it can raise the demand for its product through advertising and quality improvements. C) exit the industry. D) raise its price to cover average total cost.
There is no incentive for additional producers of an information product to enter the industry when the price charged for these products by each firm already in the industry is equal to
A) marginal cost. B) average total cost. C) average fixed cost. D) average variable cost.
Which of the following is an example where price discrimination occurs?
a. quantity discounts b. Disney World c. theatres in New York City d. all of the above
The key decision maker for general Federal Reserve policy is the:
A. Federal Open Market Committee. B. Board of Governors. C. Federal Advisory Council. D. Regional Federal Reserve banks.