Consider Figure 8.9. If David's payoff in the bottom rectangle were 40 instead of 70, the outcome of the game would be that:
A. both choose a high price.
B. both choose a low price.
C. Becky chooses a high price and David chooses a low price.
D. David chooses a high price and Becky chooses a low price.
Answer: D
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By reducing its output compared to a competitive market, a monopoly leads to
A) a more efficient use of resources. B) external benefits. C) external costs. D) a deadweight loss.
Which of the following describes the behavior of politicians implementing fiscal policy?
A. They spend in bad times because they can, and they spend in good times because they have to. B. They spend in bad times because they have to, and they spend in good times because they can. C. They save in bad times because they have to, and they save in good times because they can. D. They save in bad times because they can, and they save in good times because they have to.
McDonald's Corporation lost a battle to keep a Singapore firm, Future Enterprises, from selling goods under the labels MacNoodles, MacTea, and MacChocolate. In this case, the court system in Singapore was defining:
A. property rights. B. globalization. C. limited liability. D. consumer sovereignty.
Technological efficiency is
A) a necessary and sufficient condition for profit maximization. B) a sufficient but not necessary condition for profit maximization. C) a necessary but not sufficient condition for profit maximization. D) a theoretical construct with little connection to the real world.