The following question relates to an oligopoly market where the industry demand curve is P = 100 - Q. What will be the price and quantity of this duopoly market if the duopolists act as shared monopolists?
What will be an ideal response?
The MR = MC solution will be where MR = 0, which is where 100 - 2Q = 0. Q will equal 50, and both firms will produce and sell 25. They can price at 50 and each sell 25.
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Sellers are sure the demand for their product is relatively inelastic at the price currently being charged
A) could increase their net revenue by raising the price. B) could increase their total revenue by lowering the price. C) would decrease their net revenue if they raised the price. D) would decrease their total revenue if they raised the price.
If population growth is greater than the growth of real output
A) real per capita Gross Domestic Product (GDP) growth will be less than the growth of real Gross Domestic Product (GDP). B) the production possibilities curve is shifting to the left. C) real per capita Gross Domestic Product (GDP) growth will be greater than the growth of real Gross Domestic Product (GDP). D) real per capita Gross Domestic Product (GDP) and real Gross Domestic Product (GDP) will be growing at the same rate.
As the U.S. price level decreases, expenditures by which of the following will remain unaffected?
A. Consumers B. Businesses C. The rest of the world D. Government
The market system's answer to the fundamental question "How will the goods and services be produced?" is essentially:
A. "With as much machinery as possible." B. "Using the latest technology." C. "By exploiting labor." D. "In ways that minimize the cost per unit of output."