An increase in congestion costs associated with a public good provided through clubs will _____
a. lead to new clubs being formed
b. lead to a reduction in the optimal size of the club
c. be unrelated to congestion costs
d. lead to fewer clubs being formed
b
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In a 2-firm oligopoly, if you can choose to either be a simultaneous move Cournot competitor or a Stackelberg leader, you will always choose to be a Stackelberg leader.
Answer the following statement true (T) or false (F)
Points that lie beneath the production possibilities curve are:
A. unattainable and inefficient. B. attainable but inefficient. C. unattainable but efficient. D. attainable and efficient.
Suppose that Microsoft and Google compete in the market for PC Internet browsers. Initially these firms compete as Cournot duopolies with symmetric reaction functions. If Microsoft enters into exclusive contracts with PC suppliers that preclude suppliers from loading Google's Internet browser on PCs loaded with the Windows operating system, then Google's marginal cost of distributing its browser will increase to $5 per unit.The new equilibrium would entail Microsoft supplying ________ browsers and Google supplying ________ browsers to the market. The end result is ________ profits for Google.
A. fewer; more; higher B. more; more; lower C. fewer; fewer; higher D. more; fewer; lower
For this question, assume that firms' of productivity are accurate while workers' expectations of productivity adjust slowly over time. In this case, an increase in productivity will cause which of the following?
A) an increase in both the real wage and the natural rate of unemployment B) a decrease in both the real wage and the natural rate of unemployment C) an increase in the real wage and a reduction in the natural rate of unemployment D) a decrease in the real wage and an increase in the natural rate of unemployment E) none of the above