A successful cartel must divide the market among its members to prevent members'
A) marginal cost from exceeding their individual marginal revenues.
B) output from decreasing.
C) prices from rising above the cartel price.
D) selling costs from rising.
D
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Suppose you have $200 with which you can buy shares of stock from two companies: ABC Hot Chocolate Company and XYZ Lemonade. Each company's stock currently sells for $100 per share. If the temperature next year is lower than average, the stock price for ABC will increase by $20, and the stock price for XYZ will not change. If the temperature next year is higher than average, the stock price for XYZ will increase by $20, and the stock price for ABC will not change. There is a 50% chance that it will be colder than average next year, and a 25% chance that it will be warmer than average. If you purchase two shares of XYZ stock and no shares of ABC stock, your expected gain will be ________.
A. $30 B. $20 C. $0 D. $10
A decrease in the price a firm receives for its output will lead the firm to:
A. expand output. B. reduce output. C. cut its payments to its factors of production. D. leave output unchanged.
Suppose a price ceiling is currently set below the equilibrium price. Now suppose that policy makers decide to lower the price ceiling. This reduction in the price ceiling will cause which of the following to occur?
A. The surplus in the market will increase. B. The shortage in the market will decrease. C. The surplus in the market will decrease. D. The shortage in the market will increase.
The most competitive industry of those presented in the above table is likely to be industry
A) W. B) X. C) Y. D) Z.