If MUx/Px < MUy/Py, then
A. spending a dollar less on Y and a dollar more on X increases utility.
B. X is more expensive than Y.
C. Y is more expensive than X.
D. spending a dollar less on X and a dollar more on Y increases utility.
Answer: D
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What is the incentive for a firm to join a cartel?
A) to be able to earn larger profits than if it was not part of the cartel B) to be able to earn profits in the long run but not in the short run C) to produce a larger amount of output than if it was not part of the cartel D) to completely insulate itself from competition
If tastes for a good decreased and the price of a substitute good decreased at the same time, as a result: a. prices would rise
b. prices would fall. c. larger quantities to be exchanged. d. we would not know which direction either prices or quantities exchanged would be altered without more information.
A recent (2009) example of a U.S. tariff on foreign imports which caused retaliation from trading partners was the case of a U.S. tariff imposed on Chinese
a. tire imports. b. agricultural imports. c. airplane imports. d. clothing imports.
Excess capacity and inefficiency result under monopolistic competition.
Answer the following statement true (T) or false (F)