Economics Mcqs

A. decrease; decrease
B. increase; decrease
C. decrease; increase
D. increase; increase

A. a concentrated industry.
B. a cartel
C. price leadership
D. an oligopoly.

A. equal to what a monopolist would choose in the same industry
B. between that which would prevail under competition and that which a monopolist would choose in the same industry
C. that would prevail under competition
D. between that which would prevail under competition and that which a monopolistic competitor would choose in the same industry.

A. it assumes that firms believe that their rivals will not respond to any price change they initiate
B. it fails to explain how a firm arrived at its price and output decision initially
C. The model cannot be tested empirically.
D. Real-world pricing strategies are more simple than those assumed in this model

A. participants in a contestable market are continuously faced with competition or the threat of competition because entry is cheap
B. In a contestable market, economic profits cannot persist in the long run.
C. In a contestable market forces will guarantee that the firms produce efficiently or be driven out of business
D. For a market to be contestable, the product must be produced with a labor-intensive technology