Dell and Gateway must decide whether to lower their prices, based on the potential economic profits shown in the payoff matrix above. (The profits are in millions of dollars). In the Nash equilibrium
A) Dell keeps its prices high and Gateway lowers its prices.
B) both Dell and Gateway lower prices.
C) Gateway keeps its prices high and Dell lowers its prices.
D) both Dell and Gateway keep prices high.
B
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Crowding out refers to
A) increases in consumption, investment, or net exports caused by an increase in government purchases. B) increases in tax revenues associated with increases in tax rates. C) reductions in tax revenues associated with increases in tax rates. D) decreases in consumption, investment, or net exports caused by an increase in government purchases.
If Q = K1/2L1/2 the MPK is
a. constant b. diminishing c. increasing
Consider Figure 6.4 in your textbook, as indicated below. If the equation for the demand curve were P = 10 - Q and MC constant at 4,
(a) Find the competitive level of output and price.
(b) Find the marginal revenue and derive the rent seeking cartel's of output and price.
(c) How much rent is being raised?
If the long-run supply curve slopes downward, we know that this is
A. a decreasing-cost industry. B. a constant-cost industry. C. an increasing-cost industry. D. a situation in which no input prices change as firms enter and exit the industry.