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If the number of firms in the market under Cournot competition increases:
the market price and quantity will stay the same.
the market price will decrease due to the increased competition, but the market quantity will stay the same.
the market price will decrease and the market quantity will increase.
the market price will stay the same, but the market quantity will increase, since there are more firms producing the good.
Using the simple model of multiple deposit creation, state the ultimate impact on M1 from the Fed's sale.
Explain how many cases of toothpaste should be produced in order to maximize profits. Illustrate what happens if its decided to raise prices unilaterally in this toothpaste market.
Briefly explain the theory of reciprocal demand. How does it provide a meaningful explanation of the international term of trade?
Assuming that under cost controls rationing is as inefficient as possible while under the quota, the allocation is as inefficient as possible.
Suppose that a cost-minimizing firm, faced with constant input prices, recently increase the quantity of each of its inputs by 10%. As a result, its output increased from 100 to 120 units.
Explain how does the income approach to measuring GDP differ from the expenditure approach. Explain the meaning of value added and its importance in the income approach.
Budweiser, Miller and Coors, together with their subsidiary brands and foreign corporate partner brands produce 80% of all beer consumed in the US. Each spends well over $600 million a year on television advertising campaigns, promoting their beer br..
If the economy falls into a recession, the stock's return is projected at a negative 11.6 percent. The probability of a normal economy is 80 percent while the probability of a recession is 20 percent. Illustrate what is the variance of the returns..
Describe one possible combination of government spending increases and tax decreases that would accomplish the same goal.
Borrow from the nation with the lower nominal interest rate, invest in the nation with the higher nominal interest rate and profit from the interest-rate differential.
Consider the aggregate demand and aggregate supply model with three ranges. In which range will an increase in aggregate demand cause an output and employment increase without causing inflation?
Suppose that during the past year, the price of a laptop computer fell from $2,650 to $2,430. During the same time period, consumer sales increased from 495,000 to 664,000 laptops. Calculate the elasticity of demand between these two price–quantity c..
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