Assume a monopolist's marginal cost and marginal revenue curves intersect and the demand curve passes above its average total cost curve. The firm will:
a. make an economic profit.
b. stay in operation in the short run, but shut down in the long run.
c. shut down in the short run.
d. lower the price.
a
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Cities and towns mainly rely for revenue on
a. property taxes. b. income taxes. c. excise taxes. d. payroll taxes.
Player 1 and Player 2 are playing a game in which Player 1 has the first move at A in the decision tree shown below. Once Player 1 has chosen either Up or Down, Player 2, who can see what Player 1 has chosen, must choose Up or Down at B or C. Both players know the payoffs at the end of each branch.
Suppose Player 1 and Player 2 enter into a binding agreement in which Player 1 agrees to pay Player 2 a fixed amount of money to get Player 2 to play Up when it is Player 2's turn. How much will Player 1 have to pay Player 2 to get Player 2 to play Up?
A. at least $20. B. $0. C. at least $10. D. at least $50.