Which of the following is FALSE?
A. Engaging in predatory pricing is always more profitable than permitting existing firms to remain in the market.
B. Being the first mover is always best.
C. It is always more profitable to engage in limit pricing than to permit entry.
D. All of the statements associated with this question are false.
Answer: D
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All of the following, except one, would increase the demand for a particular model of a Ford automobile. Assume that this model is a normal good. Which is the exception?
a. an increase in buyers' incomes b. increased prices of other Ford models c. an expected future increase in the price d. an increase in the U.S. population e. a decrease in the price of steel
A circular flow diagram traces the flows of inputs and outputs between:
A. households and the government. B. households and firms. C. households in one country and households in another country. D. firms in one country and households in another country.
Which of the following statements is a normative?
a. The price of gasoline is rising b. The price of gasoline is too high c. Gas prices are expected to fall in the near future d. Cars can run on gasoline, electricity, or diesel fuel e. When the price of gasoline rises, drivers buy less gasoline
Consider the above figure. If the aggregate demand curve rose from AD1 to AD3, our nation would be experiencing
A. falling prices. B. a recessionary gap. C. unemployment. D. an inflationary gap.