Collusion occurs when
a. a firm chooses a level of output to maximize its own profit
b. firms get together to maximize joint profits
c. firms refuse to follow their price leaders
d. firms petition their U.S. senators for favors
e. two firms' price and output decisions come into conflict
B
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If the marginal value of 1 bottle of shampoo is 4 soap bars, then
a. the absolute price of shampoo is 4 times the absolute price of a soap bar. b. trading away 1 bottle of shampoo for 4 bars of soap will not affect the consumer's level of satisfaction. c. the consumer's optimum contains 4 times as many bars of soap as bottles of shampoo. d. shampoo provides 4 times as much satisfaction to the consumer as does soap.
Other things remaining unchanged, the longer the time period under consideration, the greater will be the price elasticity of demand
a. True b. False Indicate whether the statement is true or false
Which action could the Fed use to decrease the money supply?
A. an open market purchase B. an increase in the required reserve ratio C. a tax increase D. a decrease in the discount rate
If a price ceiling is set above the equilibrium price in a market
A. rationing will be necessary. B. the quantity supplied will equal the quantity demanded. C. the quantity demanded will exceed the quantity supplied. D. surpluses of the commodity will develop.