The profitability of the second mover in a Stackelberg model is
A) guaranteed to be negative.
B) smaller than that of the first mover.
C) greater than that of the first mover.
D) greater than the Cournot profits.
B
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Suppose the equilibrium interest rate in the money market is 5 percent and the current interest rate is 7 percent. As a result
A) the interest rate rises. B) real GDP increases. C) the demand for money curve shifts rightward. D) people buy bonds and the interest rate falls.
A measure of the responsiveness of the demand for one good to the percentage change in the price of another good is
A) price elasticity of demand. B) price elasticity of supply. C) cross price elasticity of demand. D) income elasticity.
What happens when the prisoners' dilemma game is repeated numerous times in an oligopoly market? (i) The firms may well reach the monopoly outcome. (ii) The firms may well reach the competitive outcome. (iii) Buyers of the oligopolists' product will likely be worse off as a result
a. (i) and (ii) b. (ii) and (iii) c. (i) and (iii) d. (i), (ii), and (iii)
The field of finance primarily studies
a. how society manages its scarce resources. b. the implications of time and risk for allocating resources over time. c. firms' decisions concerning how much to produce and what price to charge. d. how society can reduce market risk.