Which would contribute most to a firm experiencing "economies of scale"?
A. Rising long-run average costs
B. The law of diminishing marginal returns
C. Specialization of production within a firm
D. Deterioration of information and control within a firm
C. Specialization of production within a firm
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Why are many oligopolistic market outcomes conveniently described by a Prisoners' Dilemma?
A) The firms can always achieve the outcome that maximizes joint outcomes. B) The firms could do better than the Nash equilibrium if they collude. C) The outcome of a Prisoners' Dilemma is always efficient. D) The outcome of a Prisoners' Dilemma is always identical to the perfectly competitive outcome.
In August 1971, President Nixon implemented price and wage controls to combat inflation. Which of the following statements best describes the change in price levels after the price controls policy was implemented?
a. Inflation remained almost the same for many years. b. The rate of inflation decreased and remained around 3 percent throughout 1972. c.. The rate of change in prices fell below zero in mid-1970s. d. Implementation of controls led to an increase in inflation rates in 1972.
In the simultaneous move labor negotiation game:
a. The payoffs from bargaining hard are only higher if your opponent accommodates b. The payoffs from bargaining hard are only higher if your opponent bargains hard c. The payoffs are always higher if you bargain hard d. The payoffs are always higher if your opponent bargains hard
Which of the following is true? a. People specialize by concentrating their energies on the activity to which they are best suited, because they incur lower opportunity costs as a result. b. One advantage of specialization is that workers acquire greater skill from repetition
c. If a person, a region, or a country can produce a good or service at a lower opportunity cost than others, we say that they have a comparative advantage in the production of that good or service. d. All of the above are true.