A cartel is most likely to occur in
A) perfect competition as firms compete by reducing cost.
B) oligopoly as firms act together to raise prices and increase profits.
C) monopolistic competition where firms collude to increase profits.
D) oligopoly as firms compete to lower price and increase their own profits.
E) monopoly because it faces no competition.
B
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One reason Zimbabwe suffered from hyperinflation is that the government had decided to pay for all of its expenses by
A) selling Treasury bonds to foreign governments. B) selling its government-run oil company to a private company, which then defaulted on its payment. C) raising interest rates to attract foreign direct investment, then nationalizing the foreign-owned facilities. D) printing more and more money.
When marginal revenue for a seller is more than marginal cost, the seller is
A) making a positive net revenue but not necessarily maximizing net revenue. B) maximizing net revenue and making a positive net revenue. C) maximizing net revenue even if net revenue is negative. D) not maximizing net revenue.
Suppose that prices are sticky in the short-run. Which of the following best describes the economy's response to a negative demand shock?
A. Firms' inventories will increase, causing them to cut production. Ultimately, real GDP will decrease and unemployment will increase. B. Firms' inventories will decrease, causing them to increase production. Ultimately, real GDP will increase and unemployment will decrease. C. Firms' inventories will increase, causing them to cut production. Ultimately, real GDP will increase and unemployment will increase.
In the short run, the firm has no more than one fixed input.
Answer the following statement true (T) or false (F)