Refer to the above figure. Ajax and Greenco are oligopolists. Above you are given the payoff matrix for the two firms giving the payoff associated with different pricing strategies. What is the best strategy for Greenco if Ajax decides on charging a high price?
A. high price
B. low price
C. There is no best strategy.
D. Not enough information is given to determine the best strategy.
Answer: B
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What is a subgame?
A) It is a simultaneous game embedded in a sequential game. B) It is one that starts at the final decision node of the tree. C) It is one that begins at any decision node of the tree except the first decision node. D) It is one that begins at any node of the tree, including the game itself.
Measures of poverty (for example, the poverty line) and the distribution of income (for example, the Lorenz curve and the Gini coefficient) are misleading for which of the following two reasons?
A) First, these measures fail to include the income U.S. citizens earn working for foreign firms that have operations located in the United States. Second, these measures fail to include income foreign citizens earn working for U.S. firms that have operations in foreign countries. B) First, these measures do not take into account income mobility over time. Second, these measures ignore the effects of government programs meant to reduce poverty. C) First, none of these measures are adjusted for inflation. Second, they do not measure income on a per capita basis. D) First, these measures fail to include dividend and interest income earned on stocks and bonds. Second, these measures fail to include the value of goods and services citizens make for their own consumption that are not sold in markets.
A diversified portfolio represents a disadvantage to small investors since it requires large amounts of money to set up.
Answer the following statement true (T) or false (F)
Economics is best described as the
a. study of choice when scarcity exists b. study of the production of goods and services c. theory of consumer behavior d. science of money e. art of spending money wisely