If milk and cookies are complements, then their cross price elasticity of demand will be
A) elastic.
B) greater than zero but less than 1.
C) negative.
D) positive.
Answer: C
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Compared to a cartel, firms in a Cournot Oligopoly
A) make more joint profit. B) sell less output. C) make less joint profit. D) act independently.
The "lemons" problem is used to explain the concept of:
A. complete information. B. adverse selection. C. moral hazard. D. produce markets.
The United States Social Security system
a. pays benefits in direct accordance to what each individual has paid into the system. b. has paid the current generation of recipients less in benefits than it paid in payroll taxes. c. has paid the current generation of recipients more than it paid in payroll taxes. d. paid the earlier generations more and the current generation less than each paid in payroll taxes.
A firm with market power
A. faces a downward-sloping demand curve. B. can increase price without losing all sales. C. is the only seller in a market. D. both a and b E. all of the above