Which of the following statements is correct?
a. When duopoly firms reach a Nash equilibrium, their combined level of output is the monopoly level of output.
b. When oligopoly firms collude, they are behaving as a cartel.
c. In an oligopoly, self-interest drives the market to the competitive outcome.
d. An oligopoly is an example of monopolistic competition.
b
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A commercial bank has $1,000,000 of outstanding demand deposits and actual reserves of $300,000 . If the required reserve ratio is 20 percent, what is the maximum amount of new loans the bank can extend?
a. zero b. $100,000 c. $300,000 d. $700,000
Which of the following can be used to help explain wage differences among different groups of workers?
a. human capital b. discrimination c. unions d. All of the above could explain wage differences among groups.
Market failure is said to occur whenever:
A. private markets do not allocate resources in the most economically desirable way. B. prices rise. C. some consumers who want a good do not obtain it because the price is higher than they are willing to pay. D. government intervenes in the functioning of private markets.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, Point E necessarily represents
A. only motorcycles being produced. B. overallocation of resources. C. an impossible production point. D. technological advancement.