Firm A, Firm B, and Firm C are the exclusive producers of a satellite video technology that revolutionized television services. The companies have formed a cartel to limit production and fix prices to maximize profits for all members. In the given scenario, which of the following should be the ideal strategy for Firm A?
a. Produce the agreed-upon quota while keeping track of the production
levels of the other members of the cartel.
b. Produce less than the quota while raising its prices to keep demand high.
c. Produce more than the quota while lowering its prices to capture a higher market share.
d. Produce the agreed-upon quota while seeking to differentiate its product to capture a higher market share.
a
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If the minimum wage law is repealed and employers begin using efficiency wages far less frequently, it would ___ unemployment and ____ the natural rate of unemployment: a. Increase; increase
b. Increase; not change. c. Decrease; decrease. d. Decrease; not change.
Which of the following is an example of a bank's reserves?
A) currency held in the vaults of the bank B) demand deposits with other member banks C) U.S. Treasury bills D) U.S. Treasury bonds
Suppose that you open your own business and earn an accounting profit of $35,000 per year. When you started your business, you left a job that paid you a $30,000 salary annually. Also, suppose that you invested $70,000 of your own funds to start up your
business. If the normal rate of return on capital is 10 percent, your economic profit is A) $5,000. B) -$5,000. C) $2,000. D) -$2,000.
The labor force includes:
A. employed workers and persons who are officially unemployed. B. employed workers but excludes persons who are officially unemployed. C. full-time workers but excludes part-time workers. D. permanent employees but excludes temporary employees.