Which of the following is an example of a way in which an oligopolistic firm can escape the prisoner's dilemma?
A) producing more of its product
B) advertising that it will match its rival's price
C) reneging on a previous tacit agreement with rival firms to charge identical high prices
D) ignoring the pricing decisions of the other firms
Answer: B
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Suppose that real GDP grows at 3 percent per year. What is the growth rate of real GDP per person if the population grows at:
a. 2 percent? What happens to the standard of living? b. 3 percent? What happens to the standard of living? c. 4 percent? What happens to the standard of living?
In the above figure, the economy is at point A. Then the price level rises to 110 while the money wage rate remains constant. Firms will be willing to supply output equal to
A) less than $16.0 trillion. B) $16.0 trillion. C) more than $16.0 trillion. D) Without more information, it is impossible to determine which of the above answers is correct.