The strong interdependence of oligopolistic firms is shown by
A. their willingness to change prices frequently.
B. their reluctance to advertise.
C. their inability to form a price conspiracy.
D. the vulnerability of their sales to the actions of their rivals.
D. the vulnerability of their sales to the actions of their rivals.
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Firms may reasonably decide to cut prices if
A. profits are not likely to decline. B. marginal profit is not negative. C. MR > MC. D. All of the responses are correct.
"When workers already have a large quantity of capital to use in producing goods and services, giving them an additional unit of capital increases their productivity only slightly.". This statement
a. represents the traditional view of the production process. b. is an assertion that capital is subject to diminishing returns. c. is made under the assumption that the quantities of human capital, natural resources, and technology are being held constant. d. All of the above are correct.
Microsoft hires marketing and sales specialists to decide what prices it should set for its products, whereas a wealthy corn farmer in Iowa, who sells his output in the world commodity market, does not. Why is this so?
A) because Microsoft is large enough to hire the best people in the field B) because Microsoft could potentially lose sales if it sets prices indiscriminately C) because the wealthy corn farmer is a price maker who sets his price independently of the market price, but Microsoft's optimal output depends on the price it selects D) because unlike Microsoft, the wealthy corn farmer is probably a monopolist
As more of a good, such as television sets, is produced, the opportunity costs of producing it increases. This most likely occurs because
A. resources are not equally well suited to producing all goods, and as more of a good is produced, it is necessary to use resources less well suited to the production of that good. B. as more of a good is produced, the quality of that good declines, and therefore the costs of production increase. C. consumers would be willing to pay higher prices for the good as more of the good is produced. D. as more of a good is produced, the inputs used to produce that good will increase in price.