Can you think of some examples of oligopolies that you buy from?
What will be an ideal response?
The market for graphic accelerator cards is close to an oligopoly; the market for long-distance land-based telephone service is close to an oligopoly; the market for soft drinks is an oligopoly; and, the market for beer is an oligopoly.
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A grocery store sells a bag of potatoes at a fixed price of $2.30. Which of the following is a term used by economists to describe the money received from the sale of an additional bag of potatoes?
A) marginal costs B) pure profit C) net benefit D) marginal revenue E) gross earnings
Tariffs are NOT defended on the grounds that they
A) improve the terms of trade of foreign nations. B) protect jobs and reduce unemployment. C) promote growth and development of young industries. D) prevent over-dependence of a country on only a few industries. E) protect domestic producers from foreign low prices.
Which of the following statement is normative?
A. Higher taxes are needed to support education. B. A large budget surplus is likely to lower interest rates. C. Trade deficits frequently occur in conjunction with budget deficits. D. The interest rate increases are the result of Federal Reserve actions to decrease the money supply.
If a price ceiling is imposed above the equilibrium price, what is the effect?
a. There is no visible effect on the market outcome. b. A shortage results. c. A surplus results. d. The quantity demanded will decrease.