A reaction function is
A) companies colluding in order to make higher than competitive rates of return.
B) the manner in which one oligopolist reacts to a change in price made by another oligopolist in the industry.
C) a game in which firms will not negotiate in any way.
D) when plans made by firms are known as game strategies.
Answer: B
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Of the following, the largest source of revenue for the federal government is the
A) personal income tax. B) transfers from state and local governments. C) corporation income tax. D) lottery. E) revenue from the sale of public lands.
If policy makers believe that the equilibrium wage rate is too low, policy makers can raise wages by legislating a minimum wage, that is, a wage
A) ceiling above the equilibrium wage. B) ceiling below the equilibrium wage. C) floor above the equilibrium wage. D) floor below the equilibrium wage.
Refer to Scenario 1-2. Using marginal analysis terminology, what is another economic term for the incremental revenue received from the sale of the last 500 cigars?
A) sales revenue B) gross earnings C) marginal revenue D) gross profit
Discuss whether the economy would be more or less efficient if public corporations issued fewer shares of stock.
What will be an ideal response?