When firms in an industry reach an agreement to fix prices, divide up market share, or otherwise restrict competition, they are using the strategy of:
A. interindustry competition.
B. collusion.
C. price leadership.
D. limit pricing.
Answer: B
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The figure illustrates the demand for peanuts. If the price falls from $12 to $9 a bag, total revenue will ________, and if the price rises from $3 to $6 a bag, total revenue will ________
A) increase; decrease B) increase; increase C) decrease; increase D) decrease; decrease
In an open economy, expansionary monetary policy will cause
A) consumption, investment, and net exports to rise. B) consumption to fall, but investment and net exports will rise. C) consumption to rise, but investment and net exports will fall. D) consumption and investment to rise, but net exports will fall.
Third parties generally cannot win elections under a majority vote system because _____
a. the original two parties make it illegal for third parties to exist b. the original two parties are able to use the power of incumbency to raise the large amount of money necessary to run a winnable election c. the original two parties will have already split the voting population by placing their platforms on either side of the median voter d. the original two parties have already "locked-in" most eligible voters as members of their parties
The elasticity of supply is defined as the ____ change in quantity supplied divided by the ____ change in price
a. total; percentage b. percentage; marginal c. marginal; percentage d. percentage; percentage