A monopolist ________ if it chooses to sell fewer units of output.
A. can set its price wherever it desires
B. cannot change the price
C. must decrease the price
D. can increase the price
Answer: D
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Under oligopoly, if one firm in an industry significantly increases advertising expenditures to capture a greater market share, it is most likely that other firms in that industry will
A. pursue a strategy to reduce advertising expenditures to maintain profits. B. decide to increase advertising expenditures even if it means a reduction in profits. C. increase the price of the product to improve profits and then increase advertising expenditures. D. make no changes in advertising expenditures because advertising is effective in the short run, but not the long run.
An indifference curve shows
A) the relationship between prices and a household's budget. B) all possible prices and preferences for a good. C) combinations of goods among which a household is indifferent. D) budget lines among which a consumer is indifferent.
Sandy's current consumer surplus for candy is 20. Candy is a normal good for her. When her income increases and the price of candy remains unchanged, her consumer surplus will
A) increase. B) decrease. C) remain the same. D) Not enough information.
Suppose 10 workers jointly own and farm a piece of land. They all consume the farm's output in equal shares. If one worker decides to shirk and cuts her labor effort by 50 percent,
a. her consumption will decrease by 50 percent. b. her consumption will decrease by greater than 50 percent. c. her consumption will decrease by less than 50 percent. d. her consumption will not change.