The difficulty in analyzing oligopolistic behavior arises from the
a. degree of government regulation of the market structure.
b. interdependent nature of oligopolistic decisions.
c. large number of firms in the industry.
d. market power of consumers.
b
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The relative quickness with which the Open Market Committee can respond to changes in economic indicators leads the Fed to
A) control precisely the growth rate of the money stock. B) control precisely the growth rate of total spending. C) make more frequent mistakes in monetary policy than Congress makes in executing fiscal policy. D) use the discount rate to control bank lending and hence aggregate demand.
Refer to Figure 11-5. Curve G approaches curve F because
A) marginal cost is above average variable costs. B) fixed cost falls as capacity rises. C) average fixed cost falls as output rises. D) total cost falls as more and more is produced.