The advantage of game theory is that it allows us to focus on the
a. individual firm's incentives to cooperate or not
b. relationship between the market and firm level demand curve
c. costs and benefits
d. government regulators and the firms in an industry
e. models where there are no barriers to entry
A
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The quality adjustment bias of the CPI refers to the failure of statisticians to:
A. take into account price changes in goods and services. B. allow for the possibility that consumers switch from products whose prices are rising. C. take into account improvements in goods and services. D. allow for the possibility that consumers switch stores at which they shop.
An equilibrium price is unaffected by nonprice factors
a. True b. False Indicate whether the statement is true or false
Dave's Mirror Company expects to sell $1,000,000 worth of mirrors and to produce $1,250,000 worth of mirrors in the coming year. The company purchases $300,000 worth of new equipment during the year. Sales for the year turn out to be $900,000. Actual investment by Dave's Mirror Company equals ________ and planned investment equals ________.
A. $550,000; $450,000 B. $300,000; $200,000 C. $650,000; $550,000 D. $250,000; $150,000
If a firm's total fixed costs are $30, the firm's marginal cost of producing the first unit of output is $30, and the average total cost of producing two units of output is $42, the marginal cost of the second unit of output is:
A. $84. B. $54. C. $42. D. $24.