In an Oligopoly, Each Firm Knows That Its Profits

question 14

Multiple Choice

In an oligopoly, each firm knows that its profits

• A)depend only on how much output it produces.
• B)depend only on how much output its rival firms produce.
• C)depend on both how much output it produces and how much output its rival firms produce.
• D)will be zero in the long run because of free entry.

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Definitions:

Unit Of Account

A standard numerical monetary unit of measurement that provides a consistent way of quoting prices and conducting economic transactions.

M1

A category of the money supply that includes physical currency and coin, demand deposits, traveler's checks, and other checkable deposits.

Savings Deposits

accounts held at financial institutions that allow deposits and withdrawals and are subject to modest interest rates.

Commodity Money

Money that has intrinsic value and can be used for purposes other than as a medium of exchange, such as gold or silver.