Select the phrase that correctly completes the following statement. "A decrease in the expected future price caused an increase in the supply of smartphones. As a result,
A) the price of smartphones decreased and the demand for smartphones increased."
B) the price of smartphones decreased. The lower price caused the supply of smartphones to decrease."
C) the price of smartphones decreased and the quantity of smartphones demanded increased."
D) the equilibrium quantity of smartphones decreased."
C
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All industrialized countries have become “service economies” in recent decades. Explain the reasons behind this shift.
What will be an ideal response?
There is much evidence to suggest that airlines are more likely to match price cuts than price increases. Which of the following best explains this evidence?
A) No one airline wants to be the first to renege on a tacit collusive agreement in which all airlines implicitly agree to match price cuts but not price increases. B) An airline fears that if it does not match a price cut, its sales may fall considerably but if it does not match a price increase, it will be able to attract customers away from its rivals. C) The law of demand which states that an increase in price leads to a decrease in quantity demanded. D) Airlines have different costs of production and therefore it is more difficult to agree on a price increase than on a price decrease.
In game theory, a Nash equilibrium is defined as:
A) the dominant strategy of each player. B) a set of strategies for which all players are choosing their best strategy, given the actions of the other players. C) the set of strategies that result in the maximum payoff to each player. D) the set of strategies chosen when the players in a game can cooperate with each other.
The purpose of COLAs is to protect
A. borrowers. B. lenders. C. workers. D. businesses.