A potential entrant knows that it faces a (inverse) residual demand curve given by P = 90 ? 3Q. While the entrant does not know the inverse market demand, it does know that the incumbent committed to producing 10 units. Using this information, which of the following equations best summarizes the inverse market demand curve?
A. P = 80 ? 3Q
B. P = 60 ? 3Q
C. P = 50 ? 3Q
D. None of the statements is correct.
Answer: B
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One reason supply curves have an upward slope is because
A) increased supply will require increased technology. B) to have more of the good supplied requires more firms to open. C) people will pay a higher price when less is supplied. D) a higher price brings a greater profit, so firms want to sell more of that good. E) None of the above answers is correct because supply curves have a downward slope.
Five players are given $10 each and asked to contribute any portion of it to a group account. They are also told that the total collection will be doubled and distributed equally among each of them
In this case, the players are likely to contribute ________. A) $5 each B) $10 each C) $1 each D) nothing
To be the best at everything is possible
Indicate whether the statement is true or false
Keynesian policy suggests that if inflationary rises in the price level are a concern, the response would be contractionary fiscal policy, using tax increases or government spending cuts to shift AD to the left. What would the result be in this scenario?
a. The result would be downward pressure on the price level, very little reduction in output but a large rise in unemployment. b. The result would be downward pressure on the price level, but very little reduction in output or very little rise in unemployment. c. The result would be downward pressure on the price level, a large reduction in output but very little rise in unemployment. d. The result would be downward pressure on the price level, but a large reduction in output and a large rise in unemployment.