As the definition of products narrows (i.e., becomes more specific), the concentration ratio
A) is not valid.
B) tends to decrease.
C) tends to increase.
D) does not change in any predictable manner.
C
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You are given the following information on the macroeconomy:
Consumption: 200 + 0.75Y Investment: 100 + 0.10Y Government Spending 500 Exports 100 Imports 50 + 0.25Y Compute the equilibrium level of income, the size of the multiplier, and the change in equilibrium income for an increase in autonomous consumption of $50 million.
If the cross-price elasticity of demand is -3, then the goods are __________ and the consumers' responsiveness would be characterized as __________
a. substitutes; inelastic b. substitutes; elastic c. substitutes; unit elastic d. complements; inelastic e. complements; elastic
The value of a loan of $2,000 after a year at 2 percent interest is:
A. $2,040. B. $4,000. C. $2,400. D. $2,020.
Exhibit 20-6 Money, investment and product markets
?
In Exhibit 20-6, if the Fed believes the economy is at AD3, how might it engineer a decline in the price level?
A. By decreasing the money supply, the interest rate falls, investment rises, and aggregate demand falls, causing the price level to fall. B. By decreasing the money supply, the interest rate rises, investment rises, and aggregate demand rises, causing the price level to fall. C. By decreasing the money supply, the interest rate rises, investment falls, and aggregate demand falls, causing the price level to fall. D. By increasing the money supply, the interest rate rises, investment rises, and aggregate demand falls, causing the price level to fall.