In a market characterized by a single seller and many buyers, a seller's investment to reduce transaction costs can lead to which of the following situations?
a. It can reduce producer surplus in the long run.
b. It can raise the price paid by customers and still make them better off.
c. It can decrease the brand value of the product.
d. It can lower the quality of the product in the long run.
B
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Which of the following is a good example of a firm that is not likely to be perfectly competitive?
a. Farmer Joe's wheat. b. Coyote Wile’s beef ranch. c. Captain John's salmon farm. d. Aviator Alan's nonstop airline service from Seattle to Nome.
If the price of inputs rises and consumer expectations about future economic activity worsens:
a. The change in price index is uncertain, and real GDP falls. b. The change in price index is uncertain, and real GDP rises. c. Price index rises, and the change in real GDP is uncertain. d. Price index falls, and real GDP rises. e. Price index falls, and real GDP falls.
Refer to the graph below. Which of the following movements would indicate economic growth?
A. From point A to point C
B. From point B to point C
C. From point A to point E
D. From point C to point D
Game theory is a tool to analyze
a. the pricing strategy in perfect competition. b. the price set by a monopoly. c. independence among firms. d. mutual interdependence among firms.