Two perfectly competitive firms, Firm A and Firm B, both face random demand and have the same expected marginal revenue, as illustrated in the figure below. For which firm would a forecast of demand be more valuable?
A) Firm A
B) Firm B
C) The value for each firm is the same because the high demand, low demand, and expected marginal revenue are the same.
D) A forecast is more valuable for Firm A if the demand will be high and more valuable for Firm B if the demand will be low.
A) Firm A
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A baker can produce two products: cupcakes and pies. The table below is the baker's production possibilities schedule:Production Possibilities ScheduleProductABCDEFCupcakes01220365681Pies1086420Which of the following output-combinations is unattainable?
A. 2 pies and 48 cupcakes. B. 3 pies and 56 cupcakes C. 6 pies and 10 cupcakes D. 9 pies and 10 cupcakes
Suppose the Federal Reserve raised the required reserve rate. This would lead to an increase in _____.
a. interest rates b. inflation c. deficits d. aggregate demand
The demand for a particular good depends on variables such as:
A. consumer income. B. price of substitutes. C. price of complements. D. All of these.
An electricity company has the opportunity to use natural gas to generate electricity at a cost of $30 per unit in 2 years. The current market rate is 4 percent. The present value of this cost is about:
A. $28 B. $29 C. $30 D. $32