A member in a cartel can earn more profits by
A) charging a slightly lower price and raising production.
B) producing less than the agreed rate.
C) selling less than the agreed amount.
D) none of the above.
A
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Higher prices may serve the public interest when
A. there is a shortage of goods or services available. B. there is an equal distribution of traffic on alternate routes. C. higher prices never serve the public interest. D. lower prices signal scarcity.
In reality international trade is determined solely by comparative advantage and the free market forces of supply and demand
a. True b. False Indicate whether the statement is true or false
Which of the following statements best describes producer surplus in the supply and demand model?
a. Producer surplus is the area in the supply and demand model that is between the market price and the portion of the supply curve below equilibrium. b. Producer surplus is the area in the supply and demand model that is between the market price and the portion of the supply curve above equilibrium. c. Producer surplus is the area in the supply and demand model that is above the market price and the portion of the supply curve below equilibrium. d. Producer surplus is the area in the supply and demand model that is below the market price and the portion of the supply curve below equilibrium.
Suppose a large country experiences economic growth which results in a reduced willingness to trade. The country's terms of trade will ________ because the fall in demand for imports will cause the price of its exports to ________ relative to the price that it has to pay for its imports.
A. worsen; rise B. improve; rise C. worsen; fall D. improve; fall