The prisoners' dilemma describes a single-play game that features
A) an outcome in which the participants collude.
B) a large number of rivals cooperating with each other.
C) a situation in which one player has better odds than the other.
D) two players who are unable to communicate with each other.
Ques. 2In the figure above, what can be said about point B?
A) It can be reached only after economic growth occurs.
B) It can be attained only if some resources are left unused.
C) It represents all resources being devoted to the production of apples.
D) It represents all resources being devoted to the production of oranges.
Ques. 3If a graph shows a negative relationship between two variables which then becomes a positive relationship, this curve would
A) always be an upward-sloping line.
B) have a minimum point.
C) have a maximum point.
D) always be a downward-sloping line.
Ques. 4Suppose that the economy begins at a long-run equilibrium. Which of the following raises the price level and decrease real GDP in the short run?
A) a decrease in the quantity of money
B) an increase in the price of oil that decreases aggregate supply
C) an increase in the stock of capital that increases aggregate supply
D) an increase in government expenditures
Ques. 5On the island country of Sunshine where the unit of currency is fish, net exports are 50 fish, saving is 250 fish, net taxes are 100 fish, and the government budget deficit is 175 fish. What is the value of investment?
A) 375 fish
B) -375 fish
C) 25 fish
D) -25 fish
Ques. 6Monopolistic competition differs from monopoly because in monopolistic competition
A) firms maximize profits.
B) firms set marginal revenue equal to marginal cost to maximize profit.
C) firms are free to enter and exit.
D) All of the above are differences between monopoly and monopolistically competitive firms.
Ques. 7When you chose to buy the second cup of coffee instead of the third bagel, which of the following is necessarily CORRECT?
A) The second coffee will give you higher marginal utility.
B) The second coffee is cheaper than the third bagel.
C) The marginal utility per dollar from the third bagel is less than the marginal utility per dollar from the second coffee.
D) Both answers A and C are correct.
Ques. 8Education at a private university is NOT a pure public good because it is
A) nonrival.
B) excludable.
C) both nonrival and nonexcludable.
D) None of the above answers is correct.
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