In Figure 5.7, assuming perfect competition, at MR1 there will be 
A. short-run pressure on the price to rise.
B. long-run pressure on the price to rise.
C. short and long-run pressure on the price to rise.
D. no pressure on the price to change.
Answer: C
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A decrease in the US cattle herd because of drought in Texas will
A. shift the supply curve of US corn to the right. B. shift the supply curve of US corn to the left. C. shift the demand curve for US corn to the right. D. shift the demand curve for US corn to the left.
Consider an example of the prisoner's dilemma where 2 firms are making sealed bids on a contract and each firm is allowed to bid either $100 or $180. If both firms bid the same price, the job is shared equally and each firm earns half the value of its bid. Otherwise the lowest bidder wins the contract and receives the full value of its bid (and the other bidder earns zero). The non-cooperative outcome in this situation is
A) both firms bid $90. B) both firms bid $180. C) both firms bid $100. D) one firm bids $100, the other firm bids $180. E) both firms bid $50.