The law of one price states that identical products should sell for the same price everywhere as long as transactions costs are zero
Indicate whether the statement is true or false
TRUE
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Special Drawing Rights (SDRs) are issued to governments by the ________ to settle international debts and have replaced ________ in international transactions
A) Federal Reserve System; gold B) Federal Reserve System; dollars C) International Monetary Fund; gold D) International Monetary Fund; dollars
Scalping is likely to appear when a price is set below equilibrium price by the seller.
Answer the following statement true (T) or false (F)
The figure below presents information for a one-shot game.Firm AFirm B??Low PriceHigh Price?Low Price(2,2)(10,-8)?High Price(-8,10)(6,6)What are secure strategies for firm A and firm B respectively?
A. (high price, low price) B. (high price, high price) C. (low price, low price) D. (low price, high price)
Answer the following statement true (T) or false (F)
1) The larger the number of firms and the less the degree of product differentiation, the greater will be the elasticity of a monopolistically competitive seller's demand curve. 2) The economic profits earned by monopolistically competitive sellers are zero in the long run. 3) The excess capacity problem associated with monopolistic competition implies that fewer firms could produce the same industry output at a lower total cost. 4) The demand curve of a monopolistically competitive firm is more elastic than that of a pure monopolist.