What is a cartel? Can cartels generate long-term profits without the existence of barriers to entry?
What will be an ideal response?
A cartel is an association of producers in an industry that agree to set common prices and output quotas to prevent competition. If they successfully earn profits, new firms will enter, so barriers to entry are still needed.
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The payoff matrix below shows the daily profit for two firms, Row Restaurant and Column Cafe, for two different strategies, publishing coupons in the student paper and not publishing coupons in the student paper. 
If Row Restaurant publishes coupons, Column Cafe would earn the highest profit if it:
A. did not publish coupons. B. chooses either strategy because Column Cafe will have the same profit in either case. C. also published coupons. D. only offered coupons half of the time.
When the Fed is pursuing expansionary monetary policy it will tend to reduce the demand for the dollar and increase net exports, other things equal
a. True b. False Indicate whether the statement is true or false
Explain how each of the following will affect the relative values of the dollar and the euro used in France: • Income growth higher in the United States than in France. • Inflation higher in France than in the United States. • A real interest rate higher in the United States than in France
Big-push economists argue that an interlocking, balanced set of infrastructure and development investments can only be initiated, financed, and managed by
a. government b. private sector entrepreneurs c. foreign multinationals d. the World Bank e. the International Monetary Fund