A cartel attempts to increase profits in the industry by limiting the production of each member firm
a. True
b. False
Indicate whether the statement is true or false
True
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Happy Bagels sells its bagels for $6 each and the firm has a constant marginal cost of $4 per bagel, which is equal to its (constant) average total cost. If Happy Bagels does not sell a bagel the day it is produced, the bagel is sold as day-old for $2. If Happy Bagels is currently holding 50 bagels in inventory and the probability that Happy Bagels will sell 50 bagels or more is 0.50, which of
the following statements is true? A) Happy Bagels is holding the profit-maximizing, optimal level of inventory. B) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to increase its inventory. C) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to decrease its inventory. D) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to double its inventory.
The law of demand states that, other things equal, when the price of a good
a. falls, the demand for the good rises. b. rises, the quantity demanded of the good rises. c. rises, the demand for the good falls. d. falls, the quantity demanded of the good rises.
You own an ice cream store and are concerned that an employee may be giving generous scoops to friends and relatives and smaller scoops to some other customers. This is an example of
a. a moral hazard problem. b. adverse selection. c. behavioral economics. d. signaling.
What is a mutual fund?