Firms that use a price-matching strategy attempt to keep price at:
A. the oligopoly price or the monopoly price.
B. the monopoly price.
C. marginal cost.
D. the oligopoly price.
Answer: B
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
Suppose a large tree on Adam's property blocks Eve's view of the ocean. Adam accepts Eve's offer of $15,000 to cut down the tree. This is an example of
A) internalizing externalities via voluntary agreements. B) a result of logrolling. C) a consequence of a positive externality. D) a consequence of private costs exceeding social costs.
Costs that are not obvious at the start of a project are
a. variable costs b. semivariable costs c. fixed costs d. indirect costs e. hidden costs
Estimations of demand are used as input in this type of scenario:
A. understanding automobile demand to decide whether to offer below-market-rate loans for new cars. B. as input into a firm's decision-making process. C. understanding the demand for oil in order to impose a new oil import tax. D. all of the above