The more firms there are in a market, the:
A. larger will be the price effect of one firm's output decision.
B. smaller will be the price effect of one firm's output decision.
C. more collusion is likely to happen.
D. None of these statements is true.
B. smaller will be the price effect of one firm's output decision.
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Assume that an oligopolist faces a kinked demand curve. Suppose that the marginal cost curve passes through the gap in the marginal revenue curve. Price and output will be determined
a. drawing a line from the point where MC = P to both the vertical and horizontal axis, the vertical indicating output, the horizontal indicating price b. drawing a line from the point where MC = P to both the vertical and horizontal axis, the vertical indicating price, the horizontal indicating output c. at the kink d. at ATC = MC which, too, passes through the gap e. to be zero because the MC curve passes through the gap
In a market economy, economic activity is guided by
a. the government. b. central planners. c. large businesses. d. prices and self-interest.
If nominal or money GDP increases 6 percent in 2011 (compared to 2010), and real GDP increases 4 percent over the same period, which of the following must be true?
a. Exports exceeded imports. b. The general price level as measured by the GDP deflator fell during 2011. c. The economy entered a recession in 2011. d. Inflation during 2011 was 2 percent.
??Exhibit 16A-2 Macro AD/AS Models
?
?In Panel (b) of Exhibit 16A-2, a Keynesian expansionary stabilization policy designed to move the economy from Y1 to Yp would attempt to shift the
A. ?aggregate demand curve (AD) leftward. B. ?SRAS curve leftward. C. ?aggregate demand curve (AD) rightward. D. ? LRAS curve rightward.