The Bertrand model of price setting assumes that a firm chooses its price
A) independently of what price other firms charge.
B) subject to what price rival firms are charging.
C) so that joint profits are maximized.
D) without considering the shape of the demand curve.
B
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Quick Auto Service will do oil changes. If each oil change is done by five people, each of whom specializes in one task, this is an example of
A) economies of scope. B) team production. C) economies of monitoring. D) economies of coordination.
Suppose that an economy produces 30,000 units of good A which sells at $3 a unit and 60,000 units of good B which sells at $2 per unit. Production of good A contributes
a. 1/2 times as much to GDP as the production of good B. b. 3/2 times as much to GDP as the production of good B. c. 3/4 times as much to GDP as the production of good B. d. 4/3 times as much to GDP as production of good B.