Refer to Table 14-1. Let's suppose the game starts with each firm adhering to its original budget so that Godrickporter earns a profit of $6,000 and Star Connections earns a profit of $12,000
Is there an incentive for any one firm to increase its advertising budget?
A) No, neither firm has an incentive to raise its advertising budget.
B) Yes, Godrickporter has an incentive to increase its advertising budget, but Star Connections does not.
C) Yes, Star Connections has an incentive to increase its advertising budget, but Godrickporter does not.
D) Yes, both firms have an incentive to raise their advertising budgets.
B
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Suppose we claim that the rapid economic growth in Barylia can be attributed to the culture hypothesis. Which of the following statements is most likely to be concluded from this claim?
A) Barylia must have large stocks of productive natural resources. B) Institutions in Barylia must have been inclusive. C) Barylia must have a huge stock of physical capital. D) The local people in Barylia must be socially inclined to work hard.
Extensive government restrictions on the use of capital are likely to
A) result in capital resources being devoted to their most efficient uses. B) enhance economic growth. C) enhance economic freedom. D) create dead capital.