Suppliers often reduce prices because they
a. have a shortage of products to sell
b. have a surplus of products to sell
c. want to decrease consumer demand
d. want to reduce profits and go out of business
Ans: b. have a surplus of products to sell
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Consider a market in which each firm must predict the price and quantity decisions of other firms, as well as how those price and quantity decisions will affect the first firm's revenue and profit. This market is best described as
A) an oligopoly. B) monopolistic competition. C) a monopoly. D) perfect competition.
GDP tends to underestimate the productive activity in the economy because it excludes the value of output from:
A. Public transfer payments to households B. The consumption of fixed capital C. The underground economy D. Intermediate goods