Suppose duopolists face the market inverse demand curve P = 100 - Q, Q = q1 + q2, and both firms have a constant marginal cost of 10 and no fixed costs. If firm 1 is a Stackelberg leader and firm 2's best response function is q2 = (100 - q1)/2, at the Nash-Stackelberg equilibrium firm 1's profit is
A) 400.
B) 650.
C) 800.
D) 1200.
D
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In 2011, a number of Canadians purchased homes in Arizona. Which of the following would not be a logical explanation for this?
A) The value of the Canadian dollar relative to the U.S. dollar increased during this time. B) The U.S. dollar appreciated relative to the Canadian dollar during this time. C) The Canadian dollar appreciated during this time. D) The U.S. dollar depreciated during this time.
Which of these is NOT an exercise in general equilibrium analysis?
A) A discussion of factors within the wheat market that influence wheat prices B) An analysis of the effects of changes in oil prices upon the natural gas market C) An evaluation of relationships between the markets for tires and automobiles D) none of the above
A business incurs the following costs per unit: Labor $5/unit; Materials $3/unit and rent $5000/month. If the firm produces 1000 units a month, the total variable costs equals
a. $5,000 b. $8,000 c. $13,000 d. $10,000
Which of the following policy actions shifts the aggregate-demand curve?
a. an increase in the money supply b. an increase in taxes c. an increase in government spending d. All of the above are correct.