An industry comprised of a small number of firms, each of which considers the potential reactions of its rivals in making price-output decisions is called: a. monopoly. b. monopolistic competition. c. perfect competition. d. oligopoly.

The Federal Reserve will lose money as a lender of last resort if: Select one: O a. financial institutions fail to pay back their loans. O b. the output gap becomes positive. consumers complain about the use of taxpayer money. O C. O d. the economy improves.

In the model of monopolistic competition, if firms have ________ average cost curves, then opening trade will cause ________ firms to ________ the industry. A. symmetric; less efficient; exit B. symmetric; more efficient; enter C. different; less efficient; exit D. different; more efficient; enter

QUESTION 4 Suppose a stream is discovered whose water has remarkable healing powers. You decide to bottle the liquid and sell it. The market demand curve is linear and is given as follows: P = 53 - Q. The marginal cost to produce this new drink is $5. What price would this new drink sell for if the market was a Stackelberg duopoly? A. $17 В. $21 C. $29 D. $16.50