Refer to the information provided in Figure 6.5 below to answer the question(s) that follow.
Figure 6.5Refer to Figure 6.5. Molly's budget constraint is BD. Molly's income is $400, the price of a DVD is $15 and the price of a CD is $20. At point B she is buying ________ DVDs and ________ CDs.
A. 40; 30
B. 20; 0
C. 20; 15
D. 0; 20
Answer: D
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Mexico and the members of OPEC produce crude oil. Realizing that it would be in their best interests to form an agreement on production goals, a meeting is arranged and an informal, verbal agreement is reached. If both Mexico and OPEC abide by the agreement, then OPEC's profit will be $200 million and Mexico's profit will be $100 million. If both Mexico and OPEC cheat on the agreement, then OPEC's profit will be $175 million and Mexico's profit will be $80 million. If only OPEC cheats, then OPEC's profit will be $185 million, and Mexico's profit will be $60 million. If only Mexico cheats, then Mexico's profit will be $110 million, and OPEC's profit will be $150 million. You may find it helpful to fill in the payoff matrix below. src="https://sciemce.com/media/4/ppg__rrr0818190951__f1q239g1.jpg" alt="" style="vertical-align: 0.0px;" height="203" width="377" />Which of the following statements is correct?
A. OPEC's dominated strategy is to cheat on the agreement.
B. OPEC's dominant strategy is to cheat on the agreement.
C. OPEC does not have dominant strategy.
D. OPEC's dominant strategy is to abide by the agreement.
A monopolist can earn economic profits in the long run because
A) a monopoly is by definition large, and this gives it the ability to make large profits. B) a monopoly makes the good or service better than anyone else. C) barriers to entry prevent new firms from entering the industry. D) monopolies can legally force people to buy their products and to pay more for them than they are worth.
The number of seats available in an arena is fixed at 20,000. The equilibrium price for a ticket to a basketball game at the arena is $80. The equilibrium price for a ticket to a hockey game at the arena is $95. Which of the following is true?
A. The demand for each hockey game must be higher than the demand for each basketball game. B. The supply of hockey games must be less elastic than the supply of basketball games. C. The demand for hockey games must be more elastic than the demand for basketball games. D. Basketball games must be more expensive to produce than hockey games.
Refer to the data. Consumption of fixed capital is:
Answer the question on the basis of the following data. All figures are in billions of dollars.
A. $5.
B. $10.
C. $20.
D. $30.