Refer to Table 14-2. For each firm, is there a better outcome than the current situation in which each firm charges the low price and earns a profit of $7,000?
A) Yes, the firms can implicitly collude and agree to charge a higher price.
B) Yes, each firm can implicitly agree to increase output and not to deviate from a low price.
C) No, there is no incentive for each firm to consider any other strategy.
D) No, any other strategy hurts consumers.
A
Economics
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An increase in investment demand for any given level of income and interest rates—due, for example, to more optimistic "animal spirits"—will, within the IS-LM framework, ______ output and ______ interest rates.
Fill in the blank(s) with the appropriate word(s).
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