multi choice
Once a nash equilibrium has been reached in a one time game:
Players have an incentive to change their choices
No player can be made better off
A stable outcome is impossible
Players have no incentive to change their choices
Players have no incentive to change their choices
When a good has many close substitutes available, it is likely to be:
More price elastic than a good without close substitutes available
Less price elastic than a good without close substitutes available
More price elastic than a good with many complements available
Less price elastic than a good with many compliment goods available
More price elastic than a good without close substitutes available
For almost all goods, the:
Lower the price goes, the higher the quantity demanded
Lower the price goes, the higher the demand is
High the price goes, the higher the quantity demanded
Higher the price goes, the more luxurious it is
Lower the price goes, the higher the quantity demanded
___ is the quantity supplied and demanded in equilibrium price
Equilibrium quantity
____ is the relationship between quantity of inputs and the resulting quantity of outputs
Efficiency
Suppose that a tax is imposed on a market. Which statement is NOT true
The buyers equilibrium tax-inclusive price increases and the equilibrium quantity decreases
Fewer total transactions take place in the market
The market becomes more efficient as consumers change their preferences
The price the buyer pays is higher than the amount the seller receives
The market becomes more efficient as consumers change their preferences
Which of the following statements is true about trade?
Trade can benefit both parties
Trade is a zero-sum game
Trade involves a winner and a loser
Trade often hurts both parties in the long run
Trade can benefit both parties
The net increase to total surplus when a positive externality is corrected is due to:
The transfer of surplus from the consumer to those affected by the externality
The transfer of surplus from those affected by the externality to the consumer
The increased number of units bought and sold in the market
The increase in government revenue
The increased number of units bought and sold in the market
___ is the practice of charging customers different prices for the same good.
Price discrimination
_____ is the difference between the price paid by buyers and the price received by sellers in the presence of a tax
Tax wedge
If a firm in a perfectly competitive market is producing at a level of output where marginal costs are less than marginal revenue; it:
Should invest more in advertising in order to raise revenues
Is producing a profit maximizing quantity
Should increase its production to increase profits
Should cut back production to increase profits
Should increase its production to increase profits
Which of the following statements describes how a monopolist's cost curves compare to those of a perfectly competitive firm?
The shape of the cost curves are the same for a firm regardless of market structure
The monopolist's average variable cost curve is not identical to the marginal cost curve, as it is for a perfectly competitive firm.
The monopolists margin; cost curve is downward sloping, while the perfectly competitive firms is flat
The monopolist's average total cost curve is not necessarily minimized where it crosses the marginal cost curve
The shape of the cost curves are the same for a firm regardless of market structure
A number of firms that collude to make collective production decisions about quantities or prices is known as
cartel
___ is the study of how people behave strategically under different circumstances
Game theory
A good that is not excludable but is rival is a(n) _______
Common resource
Fish in the ocean are:
A public good
A common resource
An artificially scarce good
A private good
A common resource
At prices above a consumer's willingness to pay:
The buyer will purchase the good and attempt to resell it after receiving benefit
The buyer needs more income in order to buy the good
The opportunity cost of buying the good is less than the benefit received from having the good
The opportunity cost of buying the good is greater than the benefit received form having the good
The opportunity cost of buying the good is greater than the benefit received form having the good
____ is a measure of how much the demand for a good or service changes in response to a change in consumers' incomes.
Income elasticity
___is a loss of total surplus that occurs because the quantity of a good that is bought and sold is below the market equilibrium quantity
Deadweight Loss
_______ is a tax meant to counterbalance a negative externality
Pigovian tax
Long run economic profits are possible in which two market structures?
Perfect competition and monopolistic competition
Monopoly and perfect competition
Oligopoly and monopoly
Oligopoly and perfect competition
Oligopoly and monopoly
Which statement is NOT true when a firm increases production?
Its fixed costs stay the same
Its total costs increase
Its revenue automatically increases
Its variable costs rise
Its revenue automatically increases
___ is the revenue generated by selling an additional unit of a good
Marginal revenue
____ is the ability to produce a good or service at a lower opportunity cost than others
Comparative advantage
what is the name of the model we use in class
Circular flow diagram