Does the Nash equilibrium yield maximum profit?
a. Yes, because they are each getting the maximum payoff
b. No, because they could do better by pricing high
c. Yes, because they are both making sales
d. No, because they both hate selling ice cream
b
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Assume Congress enacts a $500 billion increase in spending and a $500 billion tax increase to finance the additional government spending. The result of this balanced-budget approach is a:
a. $500 billion decrease in aggregate demand. b. $500 billion increase in aggregate demand. c. $1,000 billion increase in aggregate demand. d. $1,000 billion decrease in aggregate demand.
Costs associated with economic growth include all of the following EXCEPT
A. improved health care. B. environmental pollution. C. psychological problems such as depression. D. urban congestion.
Congress and the President passed a national health care policy. This is an example of
A) increasing the marginal cost of health care. B) the government using economic tools to make policy decisions. C) increasing the marginal benefit of health care. D) normative versus positive economics. E) answering the "how" question.
A cartel is a group of firms which agree to
A) behave competitively. B) raise the price of their product. C) lower the price of their product. D) increase the amount they produce.