??Firm 2???High PriceLow PriceFirm 1High PriceFirm 1 earns $100; Firm 2 earns $100Firm 1 earns $25; Firm 2 earns $150?Low PriceFirm 1 earns $150; Firm 2 earns $25Firm 1 earns $50; Firm 2 earns $50Table 12.2The diagram shown in Table 12.2 describes a game in which:
A. firms make their decisions simultaneously.
B. Firm 1 always decides first, and Firm 2 always decides last.
C. the firms take turns moving first.
D. firms must communicate with each other before making a decision.
Answer: A
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You want to buy a TV that regularly costs $250. You can either buy the TV from a nearby store or from a store that's downtown. Relative to going to the nearby store, driving downtown involves additional time and gas. The downtown store, however, has a 10% off sale this week. Last week you drove downtown to save $20 on some concert tickets, a 15% savings. Should you drive downtown to buy the TV?
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Increases in the supply of scientists and engineers can increase the level of
a. investment. b. consumption. c. government spending. d. technology.
Suppose demand is perfectly inelastic, and the supply of the good in question decreases. As a result,
a. the equilibrium quantity decreases, and the equilibrium price is unchanged. b. the equilibrium price increases, and the equilibrium quantity is unchanged. c. the equilibrium quantity and the equilibrium price both are unchanged. d. buyers' total expenditure on the good is unchanged.
Assume the economy is initially in equilibrium where potential GDP is greater than real GDP
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