When is a collusive agreement between two firms likely to break down?
What will be an ideal response?
A collusive agreement might break down if either firm "cheats" and charges a lower price. If the other firm fails to detect it, the firm that lowers its price may be able to capture the entire market.
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Specialization allows a society to produce ________ goods.
A. more B. the same amount of C. fewer D. new
Diseconomies of scale occur
a. before the optimal scale is reached. b. at the optimal scale of operation. c. after the optimal scale is reached. d. prior to the lowest point of the ATC curve.
An investment bank purchases securities from a corporation at a predetermined price and then resells them in the market. This process is called
A) underwriting. B) underhanded. C) understanding. D) undertaking.
If there is a deliberate change in taxes and spending, it is called
A) a recessionary gap. B) an inflationary gap. C) discretionary fiscal policy. D) discretionary monetary policy.