Use the Following to Answer Questions

question 216

Multiple Choice

Use the following to answer questions:
-(Table: Demand for Crude Oil) Look at the table Demand for Crude Oil. Assume that the crude oil industry is a duopoly and the marginal cost of producing crude oil is zero. If the two firms collude to share the market equally, the price of crude oil will be _____, firm 1 will produce _____ barrels, firm 2 will produce _____ barrels, and each firm will earn revenue equal to _____.

• A) $80; 80; 80; $6,400
• B) $80; 40; 40; $3,200
• C) $60; 50; 50; $3,000
• D) $40; 60; 60; $2,400

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Definitions:

Final Sale Price

The total cost at which a product or service is sold to the consumer, including the base price plus any additional charges or fees.

Future Value

The value of an investment or a sum of money at a specified future date, accounting for specified interest rates or earnings over time.

Actively Managed

Refers to investment funds where portfolio managers make specific investments with the goal of outperforming an investment benchmark index.

Mutual Funds

Investment programs funded by shareholders that trade in diversified holdings and are managed by professional investment managers.