The more progressive the tax system, the:
A. Less is the built-in stability for the economy
B. Greater is the built-in stability for the economy
C. Less is the effect of crowding-out on the economy
D. Greater is the severity of business fluctuations on the economy
B. Greater is the built-in stability for the economy
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Refer to Table 14-4. How are the firms in this advertising game caught in a prisoner's dilemma?
A) They are not in a prisoner's dilemma because there is one clear strategy for each. B) They would be more profitable if they refrained from advertising but each fears that if it does not advertise, it will lose customers. C) Only the first mover is caught in a prisoner's dilemma because the second has a chance to observe and respond. D) Since each firm is uncertain about the other's behavior, each will adopt a wait-and-see attitude which results in no increase in market share and no new customers.
Monopolistically competitive firms can differentiate their products
A) by producing where marginal revenue equals marginal cost. B) through marketing. C) by equating price and average total cost. D) by producing at minimum efficient scale.