The above figure shows the payoff matrix for two firms, A and B, choosing to produce a basic computer or an advanced computer. How many pure-strategy Nash equilibria are in this game?
A) 0
B) 1
C) 2
D) 3
C
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If the costs of coordination and enforcement are _______________ the surplus lost to the externality, then ________________.
A. higher than; a private solution will not work B. lower than; a private solution will not work C. higher than; a private solution will work D. None of these statements is true.
According to Keynes's absolute income hypothesis, if Record Swap store manager Brenda Nielsen and pop singer Madonna were each given $1,000,
a. Madonna would likely spend less of the $1,000 on consumption than Brenda b. Madonna would likely spend more of the $1,000 on consumption than Brenda c. Madonna and Brenda would spend equal amounts of the $1,000 on consumption d. Madonna and Brenda would save equal amounts over their lifetimes e. Neither Madonna nor Brenda would save any of the $1,000
When an economy operates at its long-run potential output level,
a. aggregate demand will exceed aggregate supply in the goods and services market. b. unemployment will decline to an abnormally low rate that cannot be sustained in the long run. c. the actual rate of unemployment will exceed the natural rate of unemployment. d. the natural and actual rates of unemployment will be equal.
All firms operating in a perfectly competitive market produce unique goods
a. True b. False Indicate whether the statement is true or false