11) A Nash equilibrium in the duopoly game A) means that one player has greater market power. B) occurs when each player takes the best possible action regardless of the strategy chosen by other firms. C) will always lead to equilibrium in which the firms’ total profit is the largest. D) can occur only if firms cooperate with each other. E) means that a […]

    11) Two countries engaged in trade in products with no scale economies, produced under conditions of perfect competition, are likely to be engaged in A) inter-industry trade. B) monopolistic competition. C) intra-industry trade. D) Heckscher-Ohlin trade. E) oligopolistic competition     12) Two countries engaged in trade in products with scale economies, produced under conditions of monopolistic competition, are likely to be engaged […]

  11) Which of the following scenarios describes an action that is NOT rational from an economic point of view? A) After drinking one martini (shaken, not stirred), James buys and drinks a second martini even though the marginal benefit of the second martini is lower than the marginal benefit of the first. B) Eric buys a replacement ticket to the basketball game after he […]

  51) Suppose the exchange rate in the year 2010 was 4 yuan per dollar and in 2011 the exchange rate fell to 3 yuan per dollar. If the price of a Chinese sweater was 120 yuan in both years, the new dollar price in 2011 would be ________ and imports of Chinese sweaters would ________. A) $40; increase B) $30; decrease C) $40; decrease […]

    79.              Which of the following statements is true? a.Variances are the differences between total actual costs and total standard costs. b.When actual costs exceed standard costs, the variance is favorable. c.An unfavorable variance results when actual costs are decreasing but standards are not changed. d.All of the above are true.     80.              Unfavorable materials price and quantity variances are generally the responsibility […]

  11) A Nash equilibrium in the duopoly game A) means that one player has greater market power. B) occurs when each player takes the best possible action regardless of the strategy chosen by other firms. C) will always lead to equilibrium in which the firms’ total profit is the largest. D) can occur only if firms cooperate with each other. E) means that a […]

  8.6   Costs in the Long Run   1) Long-run cost curves are U-shaped because A) of the law of demand. B) of the law of diminishing returns. C) of economies and diseconomies of scale. D) of the law of supply.   2) If, when a firm doubles all its inputs, its average cost of production decreases, then production displays A) diminishing returns. B) economies […]

    21) Which of the following principles is consistent with the utilitarian ethical framework? A) “First, do no harm” B) “Thou shalt not kill” C) “Protect free speech” D) “Liberté, égalité, fraternité”   22) ________ refers to a system of moral principles that human beings use to judge right and wrong and to develop rules of conduct. A) Religion B) Ethics C) Creativity D) […]

    71) Suppose that when the price of hamburgers decreases, the Landry family decreases their purchases of chicken nuggets. To the Landry family A) hamburgers and chicken nuggets are complements. B) hamburgers and chicken nuggets are inferior goods. C) hamburgers and chicken nuggets are normal goods. D) hamburgers and chicken nuggets are substitutes.   72) Suppose that when the price of strawberries decreases, Simone […]

  11) Consider an industry that is made up of nine firms each with a market share (percent of sales) as follows: a.Firm A: 30% b.Firm B: 20% c.Firms C, D and E: 10% each d.Firms F, G, H and J: 5% each   What is the value of the Herfindahl-Hirschman Index and how is the industry categorized? A) 1700; moderately concentrated B) 1425; moderately […]