Strategic behavior occurs when:
a. there are a large number of firms selling identical products.
b. there is only one firm in the market.
c. the firms have no command over the prices of the good they produce.
d. the firms can take any decision irrespective of what their rival does.
e. what is best for a firm depends on what his rival does.
e
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The choice between futures and options
A) depends on whether the underlying instrument is a debt instrument or an equity. B) reflects a trade-off between the higher cost of using options and the extra insurance benefits that options provide. C) reflects a trade-off between the higher cost of using futures and the extra insurance benefits that futures provide. D) reflects a trade-off between the greater risk from using options and the extra insurance benefits that options provide.
If one Mexican peso was worth 0.05 U.S. dollar, then one U.S. dollar would be worth:
a. 20 Mexican pesos. b. 0.05 Mexican pesos. c. 5 Mexican pesos. d. 1 Mexican peso. e. 2 Mexican pesos.
Exhibit 2-4 Production possibilities curve data A B C D E Capital goods 0 10 20 30 40 Consumer goods200 180 140 80 0 In Exhibit 2-4, if the economy chooses production possibility D rather than production possibility B, it can expect
A. less growth in the future because it will use up its consumer goods. B. more growth in the future because of the accumulation of capital. C. the same amount of growth in the future but with a lower standard of living. D. the same amount of growth in the future but with a higher standard of living.
When the current short-run equilibrium is to the right of the long-run aggregate supply, appropriate discretionary fiscal policy used to address this problem would be to
A. increase government spending. B. decrease taxes. C. increase taxes. D. decrease the discount rate.