Assume that markets clear. If in the labor market there is
a. an excess supply of labor, wages will rise
b. an excess demand for labor, wages will fall
c. an excess demand for labor, wages will rise
d. an excess supply of labor, wages stay constant
e. a decline in labor demand, wages will rise
C
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If a firm with a 10 percent market share merges with a firm with 15 percent of the market, by how much will the Herfindahl index change? The other firms have 40 percent, 15 percent, 10 percent, and 10 percent shares
a. It rises by 100. b. It rises by 300. c. It falls by 200. d. It falls by 250. e. It rises by 25.
Alex's production is worth $60, Harry's is worth $40, Rob's is worth $40, and Julia's is worth $55 . They decide to combine their resources and produce together. For this to be a superadditive game, which of the following conditions must hold?
a. They should be able to produce more in groups of two than what they can produce together. b. Their combined production must exceed the total they can individually produce. c. Their resources must be perfect substitutes. d. Their resources must be perfect complements.
What would happen if a perfectly competitive firm decided to raise its prices by 1%?
a. The firm would increase revenues by 1%. b. The firm would increase market share by 1%. c. The firm would lose all of its market to its competitors. d. The firm would put all of its competitors out of business.
The total of all planned production for the economy is
A. determined only by individuals and firms. B. aggregate demand. C. determined only by the government. D. aggregate supply.