Which of the following events would increase the four-firm concentration ratio in a milk industry with six firms?
a. The two largest milk producers merge.
b. The largest milk producer buys an ice cream-making plant.
c. The largest milk producer lures customers away from the second-largest producer.
d. The four largest milk producers collusively fix prices.
a
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Suppose the supply curve and the demand curve both have unitary elasticity at all prices. The price increase to consumers resulting from a specific tax of $1 imposed on sellers will be
A) $1. B) 50 cents. C) zero. D) Impossible to calculate without knowing the slope of the supply curve.
If the marginal propensity to consume (MPC) is 0.80, the value of the spending multiplier is:
a. 2. b. 5. c. 8. d. 10.
If the production of a good generates a detrimental externality, then at that level of production of the good under perfect competition,
a. MSC > P. b. MPC > MSC. c. P > MU. d. MPC > P.
If a nation has a higher level of technology than another nation it can produce:
A. more with no use of human capital. B. more outputs with the same level of physical capital. C. less with the same amount of physical capital. D. the same output with the same level of inputs.