In an oligopoly, when the quantity effect outweighs the price effect:
A. keeping output constant and raising price will increase the firm's profits.
B. an increase in output may increase the firm's profits.
C. a decrease in output may increase the firm's profits.
D. keeping output constant and lowering price will increase the firm's profits.
Answer: B
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What will be an ideal response?
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A) It could rise or fall depending on what happens to total cost. B) It rises. C) It falls. D) It remains constant.
Rising health care spending is a problem confronting the federal government because
A) it is the government's job to make sure everyone receives the health care they need. B) federal spending on health care has increased rapidly over the last thirty years. C) the federal-funded VA hospitals have been expanding faster than government revenues can provide for. D) the medical expenses of federal employees has been rising at a rate much faster than for non-federal workers.
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