Answer the next question based on the following payoff matrix for a duopoly in which the numbers indicate the profit in millions of dollars for each firm. Firm A? High PriceLow PriceFirm BHigh priceA = $250A = $325??B = $250B = $200?Low priceA = $200A = $175??B = $325B = $175If firm A adopts the high-price strategy, then firm B would adopt the
A. low-price strategy and earn $175.
B. low-price strategy and earn $325.
C. high-price strategy and earn $250.
D. high-price strategy and earn $200.
Answer: B
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Monopolistically competitive firms face downward sloping residual demand curves because these firms
A) have relatively few rivals (compared to competition). B) sell differentiated products. C) A and/or B. D) None of the above.
The International Monetary Fund has a "quasicurrency" called
a. the Special Drawing Right. b. the Voluntary Export Restraint. c. the Monetary Trilemma. d. the Euro Dollar.
To make a correct decision about limiting imports on behalf of an infant industry, the government should look at:
a. political pressure from key constituents. b. a cost-benefit analysis measuring the present value of the likely benefits from lower production costs compared with the cost to society of higher prices in the present. c. the value of retaining U.S. jobs versus the small cost of higher priced units. d. the difficulty of keeping out imports from established trading partners and weighing the number of workers employed in the industry that could not easily get other jobs.
In the United States, the federal minimum wage in early 2016 was:
A. $7.73 per hour. B. $8.00 per hour. C. $6.50 per hour. D. $7.25 per hour.