Collusion occurs when
A) a firm chooses a level of output to maximize its own profit.
B) two firms' price and output decisions come into conflict.
C) there is an agreement among firms to charge the same price or otherwise not to compete.
D) firms refuse to follow their price leaders.
Answer: C
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The average total cost curves for Plant 1, ATC0, and Plant 2, ATC1, are shown in the figure above. The long-run average cost curve goes through points
A) C, D, G. B) A, C, E. C) A, B, D, G. D) A, B, D, E, F.
Demand curves for pure public goods satisfy the law of demand.
A. True B. False C. Uncertain
Which of the following would affect both short-run and long-run aggregate supply?
a. a supply shock b. menu costs c. money illusion d. technological change e. a change in the general price level
The sudden explosion of cheap and readily available mortgages encouraged people to:
A. buy bigger and better homes. B. become less risk-averse. C. securitize their investments. D. become more risk-averse.