A student figured out that the HHI for an industry was 15,000. What is the proper conclusion?
A. The market is close to perfectly competitive or monopolistically competitive.
B. There is free entry in the market.
C. The student made some computational errors.
D. The market is monopolistic.
Answer: C
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For many years the U.S. government imposed quotas on cheap, Middle Eastern oil imports. The U.S. consumer consequently paid $3 billion more per year for oil products. A likely rationale for such a policy is
a. people in the oil industry deserved the transfer. b. conservation. c. one cannot be dependent on foreign supplies of so crucial a resource. d. American oil was of higher quality and deserved a higher price.
If real GDP is $1000 billion and the aggregate expenditure is $850 billion, then the change in inventories will be
A. $150 Billion B. $1,850 million. C. –$1,850 million. D. –$150 million.
Goods that firms repackage or bundle with other goods for sale at a later stage
What will be an ideal response?
Assume that tortilla chips and salsa are complements. When the price of tortilla chips decreases:
A. the demand for salsa increases. B. the demand for salsa decreases. C. the supply of salsa decreases. D. the demand for tortilla chips decreases.