In the extreme case of a perfectly contestable market:
A. profits will be the same as monopoly profits.
B. profits will be the same as cartel profits.
C. profits will be the same as duopoly profits.
D. profits will be zero.
Answer: D
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Division of customers by territory or customer type is illegal
Indicate whether the statement is true or false
The above figure presents the view of the economy according to
A) Keynesian economics. B) classical economics. C) microanalysis. D) Ricardian economics.
Table 1.1 shows the hypothetical trade-off between different combinations of Stealth bombers and B-1 bombers that might be produced in a year with the limited U.S. capacity, ceteris paribus.Table 1.1Production Possibilities for BombersCombinationNumber of B-1 BombersOpportunity cost(Foregone Stealth)Number of Stealth BombersOpportunity cost (Foregone B-1)S0NA10 T1 9 U2 7 V3 4NAThe highest opportunity cost in Table 1.1 for B-1 bombers in terms of Stealth bombers is
A. 0.5 Stealth bomber per B-1 bomber. B. 3 Stealth bombers per B-1 bomber. C. 1 Stealth bomber per B-1 bomber. D. 2 Stealth bombers per B-1 bomber.
The lemons model predicts that:
A. if there are low-quality goods in the market, there will be fewer or no high-quality items. B. if there are high-quality goods in the market, there will be fewer or no low-quality items. C. the more low-quality goods there are in the market, the more high-quality goods there will be in the market. D. if buyers are pessimistic about the percentage of low-quality goods on the market, sellers of low-quality goods will be able to charge higher prices than if buyers had neutral beliefs.