The demand curve facing a dominant firm in the price leadership model is derived by subtracting the
A. amount supplied by the smaller firms from market demand.
B. dominant firm's marginal cost curve from the industry's supply curve.
C. amount demanded by customers from the smaller firms from market supply.
D. amount supplied by the smaller firms from market supply.
Answer: A
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The above figure shows Jane's budget line and two of her indifference curves. Jane's marginal rate of substitution is
A) the rate at which she would give up a lobster dinner for a steak dinner and consider herself just as well off. B) equal to the ratio of the price of a steak dinner to the price of a lobster dinner when she is at her best affordable point. C) equal to 2 lobster dinners per steak dinner at her best affordable point. D) Both answers A and B are correct.
If the level of autonomous spending in an economy increases at a given price level, _____
a. the aggregate expenditure line shifts upward and the economy moves upward along the aggregate demand curve b. the aggregate expenditure line shifts downward and the economy moves upward along the aggregate demand curve c. the aggregate expenditure line shifts upward and the aggregate demand curve shifts to the right d. the aggregate expenditure line shifts downward and the aggregate demand curve shifts to the left e. the aggregate expenditure curve shifts upward and the aggregate demand curve shifts to the left
If the dollars held for transactions purposes are, on the average, spent four times a year for final goods and services, then the quantity of money people will wish to hold for transactions purposes is equal to:
A. Four percent of nominal GDP B. 25 percent of nominal GDP C. Nominal GDP multiplied times 4 D. Nominal GDP divided by 25
As the dollar price of a euro falls
A) U.S. residents will purchase fewer French imports. B) the quantity of euros supplied will increase. C) French goods will be less expensive to U.S. residents. D) French residents will increase their purchases of U.S. assets.