When firm 1 acts as a Stackelberg leader:
A. Firm 2 will earn more than if they compete in a Cournot fashion.
B. Firm 1's profit is less than its profit if they compete in a Cournot fashion.
C. Firm 2 produces the monopoly output.
D. None of the answers is correct.
Answer: D
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A change in the price of a good leads to a change in the demand of the good.
Answer the following statement true (T) or false (F)
Refer to the data provided in Table 11.3 below to answer the following question(s). Table 11.3ProjectTotal InvestmentExpected Rate of Return(dollars) (percentage)New computer for sales staff $250,00011Remodel for distribution center$200,000 9On-site day care center $100,000 5Employee fitness center$50,000 4Refer to Table 11.3. If the interest rate is 10%, Blackstar Drone Manufacturing should
A. fund only the purchase of new computers for its sales staff. B. fund all of the projects except for the purchase of new computers for its sales staff. C. fund all of the projects. D. not fund any of the projects.