Which of the following exemplifies spatial differentiation used by firms under monopolistic competition to differentiate their product in the market?
a. A car dealer offering free after sales service for the first 8 months
b. A diamond jeweler offering products online and at retail stores situated at convenient locations
c. A cosmetics manufacturer providing free skin care tips to its customers
d. A toy manufacturer using bright colors for packaging its products
b
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Which is the most likely effect upon the market for cotton of a greatly increased price for corn, which can usually be grown on land suitable for cotton cultivation?
A) The demand for cotton will decrease and the quantity exchanged will fall. B) The demand for cotton will increase and the quantity exchanged will rise. C) The supply of cotton will increase and the quantity exchanged will rise. D) The supply of cotton will decrease and the quantity exchanged will fall. E) The supply of cotton will increase and the quantity exchanged will fall.
There are two firms that compete against each other and each needs to decide if they will undertake research and development to improve their product
The payoffs are as follows: If Firm 1 does undertake R&D then Firm 2 will earn $25 million if they also do R&D or $50 million if not If Firm 1 does not undertake R&D then Firm 2 will earn $2 million if they do R&D or $0 million if not If Firm 2 does undertake R&D then Firm 1 will earn $10 million if they also do R&D or $20 million if not If Firm 2 does not undertake R&D then Firm 1 will earn $2 million if they do R&D or $0 million if not Regarding this game, which of the following is TRUE? A) Only one will do R&D but we cannot say which one. B) Both firms will do R&D. C) Both firms will not do R&D. D) Firm 1 will do R&D and Firm 2 will not.
Which of the following actions by the Fed would increase the money supply?
a. Reducing the required reserve ratio. b. Selling bonds in the open market. c. Increasing the discount rate. d. None of these.
In general, elasticity is a measure of
a. the extent to which advances in technology are adopted by producers. b. the extent to which a market is competitive. c. how firms' profits respond to changes in market prices. d. how much buyers and sellers respond to changes in market conditions.