If Happy Campers and Camping R Us are camper suppliers in tacit collusion and Happy Campers launches a new advertising campaign that states that it will meet any competitor's price on a comparable camper, Happy Campers might be tacitly signaling to Campers R Us that they are willing to ________.
A) maintain current the price
B) cut price is exactly half
C) raise their price
D) lower their price
C) raise their price
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Suppose you have just opened a store to sell espresso machines. Both you and a competing store buy this machine from a manufacturer for $130 each
Your competitor who has a store of the same size as yours is currently selling about 10 machines a month at a price of $200 per machine. You expect to sell about 6 machines a month at a price of $220 per machine. If you lower your price, you expect to make a loss. Which of the following could explain why your competitor is able to profitably sell the machine at a lower price although the cost of purchasing the machine is the same for the both of you? A) The competing store probably has a lower marginal cost of production. B) The competing store's goal is to maximize revenue and not profit. C) The competing store probably has a lower average cost because average fixed cost falls as output increases. D) The competing store probably has a lower average variable cost of production.
__________ firms are treated similarly in financial systems around the world in the handling of their __________ conflict
A) Small; stockholder-lender B) Small; manager-stockholder C) Large; stockholder-lender D) Large; manager-stockholder
DVDs can be produced at a constant marginal cost of $10 per disk, and Roaring Lion Studios is releasing the DVDs for its last two major films. The DVD for Rambeau 17 is priced at $20 per disk, and the DVD for Schreck 10 is priced at $30 per disk
What are the Lerner indices for these two movies? A) Both equal one. B) 2 and 3, respectively C) 0.5 and 0.67, respectively D) 1 and 2, respectively
The Fed engages in open market operations and sells government securities. The result is
A) lower interest rates. B) higher interest rates. C) interest rates remain unchanged since there is no reason to think bond prices changed. D) uncertain since more information is needed.