The figure above shows the price of a DVD player from 2003 to 2007
a) What type of graph is illustrated above?
b) What is the trend in the price of a DVD player?
a) The graph is a time-series graph because it plots time along the horizontal axis and the price of a DVD player along the vertical axis.
b) The trend in the price of a DVD player is negative, that is, the price of a DVD player has generally decreased from one year to the next.
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The only two firms in a market are trying to decide what price to charge. The payoff matrix for this duopoly game is shown above. The payoffs are thousands of dollars of economic profit. Which of the following statements is correct?
A) If the firms play this game repeatedly, one would end up charging $20 and the other $10. B) If the firms cooperate, they could both earn $55,000 in economic profit. C) The Nash equilibrium in this game is for both firms to set P = $20 because that maximizes their combined profit. D) Firm B's strategy is to always set P= $20 because that gives Firm B the highest possible profit. E) If Firm B sets P = $20, then Firm A will maximize its profit by setting its P = $20.
From the perspective of an externality, most communities have zoning laws to:
A. raise government revenues. B. control external benefits. C. control external costs. D. encourage positive externalities.
Currently
where "s" and "a" refer to steel and aluminum, and Ps and Pa refer to the prices of steel and aluminum, and MPs and MPa refer to the marginal products of steel and aluminum, respectively, for a firm. Has the firm come up with the right amounts of steel and aluminum, or should it reallocate its resources to make the maximum profit?
What will be an ideal response?
If a monopolist earns positive economic profits in the long run,
A. the monopolist expands production. B. the monopolist will not change its behavior. C. new firms will enter the market. D. the industry supply curve shifts to the right.