A dominant-firm's residual demand curve is
A) the horizontal difference between the market demand curve and the supply curve of the fringe firms.
B) the vertical difference between the market demand curve and the supply curve of the fringe firms.
C) the demand curve left for the fringe firms after the dominant firm has determined an output level.
D) None of the above.
A
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The last time gas prices increased drastically, sales of large Sport Utility Vehicles (SUVs) fell. Why?
A. Higher gas prices lowered the benefit of driving an SUV. B. Higher gas prices increased the cost of driving a SUV. C. Higher gas prices lowered the cost of driving a SUV. D. Higher gas prices increased the benefit of driving an SUV.
Suppose that in a perfectly competitive market, firms are making an economic profit. In the long run, we know for sure that
a. some firms will leave the market b. the market price will rise c. the market supply curve will shift to the left d. economic profit will become zero e. production will be less than short-run production
The possibility of multiple-peaked preferences cannot be ruled out.
A. True B. False C. Uncertain
All else remaining equal, if the amount of checkable deposits increase, this will increase the size of:
a) only M1. b) only M2. c) M1 and M2. d) neither M1 nor M2.