In an oligopoly market, the firms would earn the highest profit if they
A. chose to produce an output equal to the perfectly competitive output level.
B. chose to produce the output equal to the monopoly output level.
C. chose to ignore the implications of game theory.
D. chose to ignore the actions of rival firms.
Answer: B
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Refer to the figure above. Exports for this country equal
A) OA units of Z. B) AB units of Z. C) AC units of Y. D) AD units of Y.
Economists define liquidity as
A) the difference between the return on the asset and the return on a long-term U.S. Treasury bond. B) the fraction the asset makes up of an investor's portfolio. C) the ease with which an asset can be exchanged for money. D) the difference between the total demand for an asset and the total supply of the asset.
When many banks choose to hold excess reserves, ______________ monetary policy may not work well.
a. tight b. free c. expansionary d. contractionary
When a negative externality creates a market failure, that failure can be corrected by
a. setting price equal to private cost b. setting price equal to social cost c. setting price equal to the externality cost d. creating a positive externality of comparable value e. setting private cost equal to social cost