If a firm is forced to take external costs into account, it will
A) reduce production and charge a higher market price.
B) increase production and charge a lower market price.
C) reduce prices and hire more workers.
D) reduce prices and hire fewer workers.
A
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In a dynamic game, rational players
A) will reject outcomes that are not subgame perfect. B) use backward induction to determine best responses. C) have strategies that select a Nash equilibrium in the game as a whole. D) All of the above.
The stock price of a firm is primarily a reflection of the
a. firm's current net earnings per share. b. firm's expected future net earnings per share. c. discounted value of the firm's expected future net earnings per share. d. firm's current net earnings per share multiplied by the interest rate. e. book value of the firm.
The present value of $1 million to be received in the future will
a. increase if the interest rate rises. b. increase if the payment is received at a more distant time in the future. c. be greater than $1 million. d. increase if the interest rate were to fall from 8 percent to 4 percent.
Classical economists are more likely than Keynesian economists to focus more on _____
Fill in the blank(s) with the appropriate word(s).