How does the existence of the fringe alter the price and output in an oligopoly market?
The existence of a fringe makes price lower and output higher than would occur without it. The smaller the percentage of the market served by the fringe, the higher will be the price the dominant firm chooses and the higher its percentage of market output. The more elastic the supply curve of the fringe, the more elastic residual demand will be and the lower the dominant firm's profits.
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The effect of a recession on a company like Whirlpool Corporation is such that
A) the decline in sales is more short-lived as compared to firms that do not produce durable goods. B) profits fall less sharply as compared to firms that do not produce durable goods. C) there is no difference in the impact of the recession on its profits as compared to firms that do not produce durable goods. D) sales decline more sharply for Whirlpool as compared to firms that do not produce durable goods.
In a situation where a car salesman is selling cars on behalf of the dealer, the salesman is the
a. Principal b. Agent c. Both of the above d. None of the above
Union membership was relatively low during the Great Depression.
Answer the following statement true (T) or false (F)
Because a monopoly ignores external costs, it is possible that it will
A) produce the socially optimal quantity of a good. B) produce more than the socially optimal quantity of a good. C) produce less than the socially optimal quantity of a good. D) All of the above.