Firms in an oligopoly market can potentially earn economic profits.
a. ?In the short run, but not the long run.
b. ?In the long run, but not the short run.
c. ?In both the short run and long run
d. ?In neither the short run nor the long run
Answer: c. ?In both the short run and long run
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In game theory, strategies include ________
A) all possible actions of each player B) only the winning action of each player C) all possible actions and payoffs of each player D) the payoff matrix
Other things being equal, the less elastic demand is: a. the lower the deadweight loss is resulting from the imposition of a given tax on a product. b. the greater the burden is of the tax borne by consumers
c. the greater the tax revenue collected by the government is. d. all of the above
Externalities cause the market mechanism to allocate goods and resources inefficiently because
a. nonconsenting third parties are generally not hurt by externalities. b. producers and consumers ignore signals given by the competitive market. c. prices are always higher than they should be. d. competitive markets fail to give producers and consumers correct price signals.
Four points on a demand schedule are given: $12, 2 units; $10, 3 unit; $15, 5 units; and $2, 4 units. Which combination is inconsistent with the law of demand?
A) $12 and 2 units B) $10 and 3 unit C) $15 and 5 units D) $2 and 4 units