A cartel is a collusive agreement among a number of firms that is designed to
A) expand output and lower prices but not to a predatory level.
B) restrict output and lower prices to a predatory level.
C) restrict output and raise prices.
D) expand output and raise prices.
E) expand output and lower prices to a predatory level.
C
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An increase in the availability of an important major resource such as oil shifts the:
a) aggregate-supply curve to the left. b) aggregate-demand curve to the left. c) aggregate-supply curve to the right. d) aggregate-demand curve to the right.
Answer the following statement true (T) or false (F)
1) Higher user costs imply that a resource should be extracted more quickly. 2) The total cost of extracting and selling a resource in a given year is the sum of the extraction cost and user cost. 3) The higher a resource's current price, the more extraction should be delayed to a later period. 4) User cost is defined as the present value of the profit the company would earn if it delayed extraction until next year.