Consider the data in Table 9.6. Both firms can benefit if Firm A sells its pollution permit allowing it to generate 100 gallons of wastewater to Firm B for:
A. a price between $7 and $12.
B. a price between $0 and $7.
C. a price between $12 and $18.
D. Both firms cannot benefit if A sells permits to B.
Answer: A
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Which of the following is NOT an asset of the Federal Reserve System?
A) mortgage-backed securities B) reserves of depository institutions C) U.S. government securities D) None of the above are correct because they are all assets of the Federal Reserve.
John and Sally have identical preferences except that Sally's utility is exactly 10 times John's for each basket of goods. If they have the same income and face the same prices
A) Sally will consume 10 times the amount that John consumes. B) Sally will receive 1/10 the satisfaction of John. C) both will consume the same amount of all goods. D) John and Sally will have equal total utility.
In a purely competitive market, a company views its demand curve as
A. vertical. B. convex. C. horizontal (flat). D. completely price insensitive.
An oligopoly is an industry market structure with
A. a single firm in which the entry of new firms is blocked. B. a small number of firms each large enough to impact the market price of its output. C. many firms each able to differentiate their product. D. many firms each too small to impact the market price.