In each of the following situations, list what will happen to the equilibrium price and the equilibrium quantity for a particular product, which is a normal good
a. The price of inputs decrease
b. The price of a complement increases
c. The number of producers in the market increases
d. Income increases
e. The price of a substitute in production increases
a. Price decreases; Quantity increases
b. Price decreases; Quantity decreases
c. Price decreases; Quantity increases
d. Price increases; Quantity increases
e. Price increases; Quantity decreases
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The above figure shows the payoff matrix for two firms, A and B, choosing to produce a basic computer or an advanced computer
Now the payoff of the firm who produces a basic computer falls to 10 if the other firm chooses to produce an advanced computer. Then A) both firms will have dominant strategies. B) Nash equilibria will not change. C) joint profits will be maximized at the Nash equilibrium. D) Firm A and firm B will choose different actions.
One firm previously operated as a monopoly. Now, one potential entrant exists. Consumers would prefer
A) entry, and the firms to split the output equally. B) no entry, and for the incumbent to produce the Stackelberg leader level of output. C) entry, and for the incumbent to produce the Stackelberg leader level of output. D) no entry, and the monopoly to continue.
Why does the holding of excess reserves by banks and the holding of currency by households and firms cause the real-world deposit multiplier to be less than the simple deposit multiplier?
What will be an ideal response?
An increase in the dollar price of the English pound will
A. increase the supply of dollars. B. decrease the supply of pounds. C. cause an increase in the pound price of the dollar. D. cause a decrease in the pound price of the dollar.