In a grim-trigger strategy, a firm responds to underpricing by choosing a price so low that each firm makes zero economic profit.
Answer the following statement true (T) or false (F)
True
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Firms use incentives to pursue their most fundamental goal, which is to maximize
A) profits. B) sales revenue. C) worker satisfaction. D) worker pay.
If a union is able to decrease the supply of workers in a competitive labor market but the union cannot affect the demand for its members' labor, then
A) wages and the quantity of labor hired will both increase. B) wages will increase but the quantity of labor hired will decrease. C) wages will decrease but the quantity of labor hired will increase. D) wages and the quantity of labor hired will both decrease.
"Because apples and oranges are substitutes, an increase in the price of oranges will cause the demand for apples to increase
This initial shift in demand for apples results in a higher price for apples; this higher price will cause the demand curve for apples to shift to the right." Which of the following correctly comments on this statement? A) The statement is false because oranges are inferior goods; apples are normal goods. B) The statement is false because one cannot assume that apples and oranges are substitutes for all consumers. C) The statement will be true if consumer tastes for apples and oranges do not change. D) The statement is false because a change in the price of apples would not change the demand for apples.
The country of Excludania can discourage foreign investment by
a. requiring foreign investors to find a local partner who must be granted controlling interest b. setting different exchange rates for different categories of transactions c. heavily restricting private international borrowing and lending d. All the answers are correct e. None of the answers is correct