Suppose you hold $5,000 in cash when the interest rate on bonds is 4 percent. Other things equal, as the bond interest rate declines to 3 percent, you will want to hold more money because the opportunity cost of holding money has decreased
a. True
b. False
Indicate whether the statement is true or false
True
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A market structure in which there is one large firm that has a major share of the market and many smaller firms supplying the remainder of the market is called:
A) the Stackelberg Model. B) the kinked demand curve model. C) the dominant firm model. D) the Cournot model. E) the Bertrand model.
Refer to the following payoff matrix:Player 1Player 2??ab?A$50,$5$25,$30?B$40,$2$20,$1Suppose the simultaneous-move game depicted in this payoff matrix could be turned into a sequential-move game with player 1 moving first. In this case, the equilibrium payoffs will be:
A. ($25, $30). B. ($20, $1). C. ($40, $2). D. ($50, $5).
If a firm wants to increase revenue, it should decrease the selling price of its product if it is currently producing in the ________ portion of its demand curve.
A. perfectly inelastic B. inelastic C. elastic D. unit elastic
Which statement is the false?
A. Advertising will tend to shift the demand curve for the product to the right. B. The goal of advertising is the make a firm's demand curve less elastic. C. Advertising campaigns attempt to convince the consumer that the product is unique and a necessity. D. Advertisers go to great lengths to build brand loyalty, thereby making the demand for their products more elastic.