Consider Figure 12.3. If Becky's payoff in the second rectangle from the top were 80 instead of 60, the outcome of the game would be that:
A. both choose a high price.
B. both choose a low price.
C. Becky chooses a high price and David chooses a low price.
D. David chooses a high price and Becky chooses a low price.
Answer: C
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The public's fear of centralized power and distrust of moneyed interests led to the demise of the first two experiments in central banking, otherwise known as
A) the First Bank of the United States and the Second Bank of the United States. B) the First Bank of the United States and the Central Bank of the United States. C) the First Central Bank of the United States and the Second Central Bank of the United States. D) the First Bank of North America and the Second Bank of North America.
Assume that each day a firm uses 13 employee-hours per day and an office to produce 100 units of output. The price of each unit output is $5, the hourly wage rate is $10, and rent on the office is $200 per day. Each day the firm earns a ________ of ________.
A. loss; $200 B. loss; $170 C. profit; $170 D. profit; $370
When what people pay does not necessarily reflect the real value they put on a good, it is likely that the:
A. good will be undersupplied. B. not a socially desirable good. C. free rider problem does not exist. D. good is easily excludable.
In the Phillips curve equation, which of the following will cause an increase in the current inflation rate?
A) an increase in the expected inflation rate B) a reduction in the unemployment rate C) an increase in the markup, m D) all of the above E) none of the above