A market comprised of only two firms is called a
A) competitive market. B) monopoly.
C) duopoly. D) monopolistically competitive market.
C
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If the Fed sells bonds through its open market operations, then there is
A) a decrease in interest rates because of the increase in the supply of bonds. B) an increase in the demand for bonds and a rise in the price of existing bonds. C) a decrease in interest rates because of the decrease in the demand for bonds. D) an increase in the supply of bonds and a fall in the price of existing bonds.
An increase in a retailer's "overhead expenses"
A) compels the retailer to raise prices. B) enables the retailer to raise prices. C) makes it profitable for the retailer to raise prices. D) does not in itself make higher prices necessary, possible, or profitable.
In an economic model, an exogenous variable is
A) a stand-in for more complicated variables. B) determined by the model itself. C) determined outside the model. D) a variable that has no effect on the workings of the model.
A production function tells the firm
A) the maximum it can expect to produce with a given mix of inputs. B) the average it can expect to produce with a given mix of inputs. C) the minimum it can expect to produce with a given mix of inputs. D) the average level of production for other firms in the industry.