If the Herfindahl-Hirschman Index of an industry is greater than 1,800, then the Antitrust Division of the Justice Department
A. will not challenge any merger.
B. considers the industry moderately concentrated.
C. considers the industry unconcentrated.
D. will challenge any merger that raises the index by more than 50 points.
Answer: D
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A requirement of perfect competition is that
i. many firms sell an identical product to many buyers. ii. there are no restrictions on entry into (or exit from) the market, and established firms have no advantage over new firms. iii. sellers and buyers are well informed about prices. A) i only B) i and ii C) iii only D) i and iii E) i, ii, and iii
The difference between nominal GDP and real GDP is
A) the indirect taxes used in their calculations. B) the prices used in their calculations. C) that nominal GDP includes the depreciation of capital and real GDP does not. D) that nominal GDP includes net exports of goods and services and real GDP includes net imports. E) that real GDP includes the depreciation of capital and nominal GDP does not.
"Banks hold 100 percent of their customers' deposits as reserves." Is the previous statement correct or not?
What will be an ideal response?
Suppose that Brazil is capital abundant and Chile is natural resource abundant. If timber is natural resource intensive and computers are capital intensive, then
A) Chile will produce more computers after trade begins with Brazil. B) Brazil will produce more timber after trade begins with Chile. C) Chile will produce more timber after trade begins with Brazil. D) Brazil will completely specialize in computers once trade begins with Chile.