The underlying reason why gasoline prices at neighboring stations are usually identical is that
A. these operators are usually friends and benefit from the other's presence.
B. collusion is prevalent in the energy sector.
C. because under oligopoly, it can be in each firms best interest to independently charge a price equal to their competition's price.
D. collusion is legal in the energy sector.
Answer: C
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Over long time horizons, the more independent a country's central bank is,
A) the lower the inflation that country experiences. B) the better chance that country has of experiencing hyperinflation. C) the higher the country's unemployment rate tends to be. D) the more politically unstable the country becomes.
What are the different types of trade barriers? What are the arguments for trade barriers? What are the consequences of trade barriers?
What will be an ideal response?