A cartel is
A. A group of firms with an explicit, formal agreement to fix prices and output shares in a particular market.
B. Not illegal in the United States.
C. A type of market structure.
D. An organization intended to increase competition in an industry.
Answer: A
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Unemployment benefits in western Europe are more generous than in the United States. As a result, ________ in the United States
A) frictional unemployment is higher B) frictional unemployment is lower C) cyclical unemployment is higher D) structural unemployment is higher E) avoidable unemployment is lower
If a perfectly competitive industry is in long-run equilibrium, firms maximize profits, and the process of entry and exit results in
A. all firms producing where P = MC = AC. B. a left shift in the industry supply curve. C. a few firms earning economic profits. D. the price falling to the point where MR > MC.
Mass marketing involves
A) using all types of media, such as television and radio, to reach as many consumers as possible. B) Internet ads only. C) using direct mailings only. D) lower-cost methods of advertising.
A monopolist faces the (inverse) demand for its product: p = 50 - 2Q. The monopolist has a marginal cost of 10/unit and a fixed cost given by F
a. Assume that F is sufficiently small such that the monopolist produces a strictly positive level of output. What is the profit-maximizing price and quantity? b. Compute the maximum profit for the monopolist in terms of F. c. For what values of F will the monopolists profit be negative?