A Herfindahl index of 0 suggests:
A. perfect competition.
B. oligopoly.
C. monopolistic competition.
D. monopoly.
Answer: A
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If, for a product, the quantity supplied exceeds the quantity demanded, the market price will fall until
A) all consumers will be able to afford the product. B) the quantity demanded exceeds the quantity supplied. The market will then be in equilibrium. C) quantity demanded equals quantity supplied. The equilibrium price will then be lower than the market price. D) quantity demanded equals quantity supplied. The market price will then equal the equilibrium price.
Which of the following is a problem with the price system that can lead to fluctuations in output?
A. The price system works silently in the background. B. Prices can be slow to adjust. C. Prices may be flexible. D. All of these
Explain why gasoline stations across the street from each other with large signs displaying their prices may "legally" jointly set monopoly prices
What will be an ideal response?
Refer to the data provided in Table 16.2 below to answer the following question(s).Table 16.2 shows the situation facing two firms, both of which are polluting. Assume that each firm emits 5 units of pollution.Table 16.2Firm AFirm AFirm AFirm BFirm BFirm BReduction of Pollution by Firm AMC of reducing pollution for Firm ATC of reducing pollution for Firm AReduction of Pollution by Firm BMC of reducing pollution for Firm BTC of reducing pollution for Firm B1$1$11$8$82 3 4212203 6103163641020420565153552480Refer to Table 16.2. Suppose the government wants to reduce the total amount of pollution from the current level of 10 to 4. To do this, the government caps each firm's emissions at 2 units and issues 2 permits to each firm. If firms are allowed to trade permits and all possible
trades are made, Firm A will reduce its pollution by a total of ________ units. A. 2 B. 3 C. 4 D. 5