Theoretically, profit maximization occurs at P* and q* in the short run. However, empirical work suggests that oligopolists often actually charge P1. What would be the motivation for this action?
a. to increase P 1 above the profit maximization price over the short run
b. to reduce the entry initiative for new firms attracted by long-run economic profit
c. to increase the profit maximization price over the short run
d. to reduce the entry initiative for new firms attracted by zero long-run economic profit
b. to reduce the entry initiative for new firms attracted by long-run economic profit
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The paper currency used by the U.S. at the beginning of the Civil War was referred to as a demand note because:
A) the currency could be exchanged for gold on demand. B) it was used to create the demand for various goods and services. C) demand for the currency was kept constant over the entire period of Civil War. D) it was limited in supply, and there was always an excess demand for the currency in the country.
A distinction between stocks and bonds is that
A) although the return on a bond is determined by the forces of supply and demand, the return on a stock is set by the stock exchange. B) stocks represent ownership claims to the company and bonds do not. C) bonds must be held for a fixed number of years whereas stocks can be bought and sold at any time. D) bonds can be traded many times in the bond market, while stocks are non-transferable. E) bonds cannot be sold to anyone other than the company that issued it while stocks can be resold to anyone.
In Canada, the government alone is responsible for paying health care providers for delivering medically necessary procedures
Indicate whether the statement is true or false
If the short-run Phillips curve was a straight line with a very steep slope, the inflation costs of reducing unemployment: a. are fairly low
b. are fairly high. c. depend on the current rate of inflation. d. rises as the economy approaches full employment.