Related to the Economics in Practice on p. 297: According to the Economics in Practice, in a town with multiple newspapers
A. there are strong incentives for firms to differentiate and focus on the part of the market with less competition.
B. there are strong incentives for firms to produce a similar product and focus on the part of the market with the most competition.
C. there is virtually no possibility for firms to produce a similar product and remain in business.
D. there are virtually no incentives for firms to differentiate and focus on the part of the market with less competition.
Answer: A
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If a tax is placed on tires, then i. the equilibrium quantity of tires will decrease. ii. a deadweight loss will be created. iii. the producer surplus will decrease
A) i only B) ii only C) i and iii D) i and ii E) i, ii, and iii
Which of the following is a responsibility of the Federal Open Market Committee (FOMC)?
a. Levying direct and indirect taxes b. Buying and selling U.S. government bonds c. Setting the discount rate d. Setting the minimum reserve ratio
When a tariff is imposed on an imported good, the prices of the similar products produced within the country also increase.
Answer the following statement true (T) or false (F)
Which of the following is a TRUE statement?
A. Voluntary agreements can solve externality situations by making the party incurring the costs bear the costs of his or her actions. B. Externalities can only be handled by government regulation and emission taxes cannot work effectively. C. Externalities would never be a problem if people were willing to comply with government regulations. D. Externalities cannot be solved by market solutions and always require government action.