Price wars can be the result of
A) a cooperative equilibrium.
B) a firm playing a tit-for-tat strategy in which last period the competitors complied with a collusive agreement.
C) new firms entering the industry and immediately agreeing to abide by a collusive agreement.
D) new firms entering an industry and all firms then finding themselves in a prisoners' dilemma.
D
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The best example of a merit good or activity is:
A. exercising too much. B. teaching baseball to boys and girls in the community. C. excessive consumption of pork. D. providing free beer to teenagers.
Which of the following activities increases the demand for union labor?
A) a decrease in the minimum wage B) a decrease in immigration C) an increase in the union wage D) an increased desire by consumers to buy imports
A lower interest rate makes more investment projects profitable, meaning that:
a. there is a direct relationship between the rate of interest and the quantity of investment spending. b. there is an inverse relationship between the rate of interest and the quantity of investment spending. c. there is no relationship between the rate of interest and the quantity of investment spending. d. the demand curve for investment spending is horizontal. e. the demand curve for investment spending is vertical.
Environmental damage
a. cannot be reduced to zero. b. is inevitable where humans exist. c. tends to increase as long as benefits outweigh the costs to the damagers. d. All of the above are correct.