Black markets that operate outside the legal system are often characterized by
a. low profits for suppliers.
b. lower opportunity costs for suppliers and buyers.
c. decreased prices.
d. the use of violence as a means of settling disputes.
D
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If the Fed buys government securities, then
A) the quantity of money is not changed, just its composition. B) new bank reserves are created. C) the quantity of money decreases. D) bank reserves are destroyed. E) banks' excess reserves decrease.
The kinked demand curve:
a. applies when competitors match price decreases but not price increases. b. could apply to market demand in any market structure. c. applies when competitors match price increases but not price decreases. d. applies to the price leadership model. e. applies when competitors act independently.
Exit from a market will stop when
A) accounting losses are zero. B) the cost of capital is equal to the risk-free rate of return. C) economic losses are zero. D) none of these choices.
Which of the following statements explains increasing returns to scale? a. A larger firm can produce at a higher average total cost than a smaller firm. b. A larger firm can produce at a lower average total cost than a smaller firm
c. A larger corporation has lower opportunity costs than a smaller corporation. d. The cost of production for each unit of good in a small firm always increases as output increases.