If average variable cost exceeds price for a perfectly competitive firm in the short run, then it could increase profits by raising its price
a. True
b. False
B
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Suppose the firm or firms in the market for Good A face a downward-sloping demand curve, maximize profit by producing the quantity at which marginal revenue equals marginal cost, set the price higher than the marginal cost, and break even in long run equilibrium. Which one of the following market structures most likely exists for Good A?
A. Perfectly competition. B. Monopoly. C. Monopolistic competition. D. Oligopoly.
The advantage of a system of fixed exchange rates over one where exchange rates are flexible is that
A. the government gains more control over the economy. B. floating exchange rates impose risks on importers and exporters from unpredictable exchange rates. C. exchange controls become unnecessary. D. fiscal and monetary policy can focus more on domestic conditions.
The stronger the product differentiation in monopolistic competition, the:
A. Less elastic the demand curve, and production will take place further to the left of minimum average costs B. Less elastic the demand curve, and production will take place further to the right of minimum average costs C. More elastic the demand curve, and production will take place further to the left of minimum average costs D. More elastic the demand curve, and production will take place further to the right of minimum average costs
Which of the following is not a characteristic of a battle of the sexes game?
A) Each player has a dominant strategy. B) Nash equilibria exist at every outcome where the players successfully coordinate. C) The two general outcomes are where players either coordinate with one another or they do not. D) The payoff for coordinating is higher than the payoff for not coordinating.