Because firms selling a homogeneous product set price in response to the (perceived) pricing decision of other firms in the Bertrand Model of oligopoly in equilibrium price exceeds marginal cost
Indicate whether the statement is true or false
False. Because firms set price and sell a homogeneous product other firms will always set price lower if a firm prices above marginal cost. In equilibrium all firms charge P=MC (same as the competitive equilibrium)
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Which of the following statements concerning stabilization policy is correct?
A) Increasing government spending during an economic boom would be an example of a stabilization policy. B) Increasing taxes during a recession would be an example of a stabilization policy. C) New Keynesian economists are skeptical of the value of stabilization policies. D) Increasing the money supply during a recession is an example of a stabilization policy.
Exhibit 5-5 Demand curve for computers
?
In Exhibit 5-5, the total revenue at point E on the demand curve equals:
A. OD. B. FE. C. DE. D. ODEF.