In which of the following models of firm behavior do firms make strategic pricing decisions and also charge a perfectly competitive price?
A. Contestable market model of oligopoly
B. Monopoly model
C. Perfectly competitive model
D. Cartel model of oligopoly
Answer: A
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Which trade strategy have developing countries used to restrict imports of manufactured goods so that the domestic market is preserved for home producers?
A) international commodity agreement B) export promotion C) multilateral contract D) import substitution E) export subsidies
Consider an industry with two firms producing similar products. Each firm's total cost (in dollars) is given below.Acme Manufacturing: TC = 100 + 3Q Generic Industries: TC = 500 + 3Q When each firm is producing the same quantity, Acme's average total cost is:
A. lower than Generic's average total cost at some levels of output, and higher than Generic's average total cost at other levels of output. B. lower than Generic's average total cost. C. equal to Generic's average total cost. D. higher than Generic's average total cost.
If the economy is represented in the graph shown and is currently at point E2, which action is the Fed most likely to undertake?
A. Contractionary monetary policy, because it will shift AD to the left. B. Expansionary monetary policy, because it will shift AD to the right. C. Expansionary monetary policy, because it will shift AD to the left. D. Contractionary monetary policy, because it will shift AS to the right.
If interest rates decrease to a very low level, people will most likely hold
A. more money in savings accounts and more cash. B. less money in savings accounts and more cash. C. more money in savings accounts and less cash. D. less money in savings accounts and less cash.