Refer to Scenario 13.1. At your negotiated price your consumer surplus is:
A) $50.
B) $200.
C) $250.
D) $300.
C
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In the game in Scenario 13.17, Incumbent Monopoly has
A) an incentive to threaten accommodation, which would be credible. B) an incentive to threaten war, which would be credible. C) an incentive to threaten accommodation, which wouldn't be credible. D) an incentive to threaten war, which wouldn't be credible. E) no incentive to make a threat.
When an entrepreneur invests his own financial capital in order to start a business
A) the opportunity cost of capital should be included in the economic cost of doing business. B) the investment is treated as a fixed cost, so it should not be considered as a cost of doing business. C) the firm's economic profits will exceed its accounting profits. D) the accounting costs increase because the funds would otherwise have to be borrowed.
Assume that the Fed lowers the required reserve ratio. How will this affect the money supply?
a. It would decrease. b. It would increase. c. It would remain unchanged. d. It depends on the value of interest rates.
In the long run the prices charged by a firm in a competitive price-searcher market will be
a. high enough to provide profits to the firm. b. so low that many firms will drop out of the industry. c. equal to marginal cost. d. equal to average cost, including the opportunity cost of capital.