Answer the following statements true (T) or false (F)
1. Prices in monopolistic industries are predicted to fluctuate widely and frequently compared to other market structures.
2. If an oligopolist's competitors follow its price cuts but ignore its price increases, the oligopolist would end up holding its price constant even if its marginal cost changes.
3. A cartel of four firms that controls 100 percent of the output in a market, and faces the same cost schedules that a monopolist would have, will set a price somewhat lower than the monopoly price for its product.
4. OPEC functions as a classic example of a kinked demand curve oligopoly.
5. A firm in a cartel typically cheats on its collusive agreement by raising its price and restricting output more than it agreed to with other cartel members.
1. FALSE
2. TRUE
3. FALSE
4. FALSE
5. FALSE
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The four components of GDP are consumption expenditures, private investment expenditures, government purchases, and transfer payments
Indicate whether the statement is true or false
When all other influences on firms' hiring plans remain the same, the
A) lower the real wage rate, the greater is the quantity of labor supplied B) higher the real wage rate, the greater is the quantity of labor demanded. C) lower the real wage rate, the smaller is the quantity of labor demanded. D) lower the real wage rate, the greater is the quantity of labor demanded. E) None of the above answers is correct because firms' hiring decisions depend on how profitable hiring a worker is, which depends on how much added profit the worker can create.