Sue and Jane Own Two Local Gas Stations

question 98

Multiple Choice

Sue and Jane own two local gas stations.They have identical constant marginal costs,but earn zero economic profits.Sue and Jane constitute:

• A) a Sweezy oligopoly.
• B) a Cournot oligopoly.
• C) a Bertrand oligopoly.
• D) None of the preceding answers is correct.

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Definitions:

Cash Flow

The net amount of cash and cash-equivalents being transferred into and out of a business.

Marketable Securities

Financial instruments that can be easily converted into cash, such as stocks or bonds.

Operating Activities Section

A component of the cash flow statement showing cash inflows and outflows related to the primary business activities.

Direct Method

A way of preparing a cash flow statement where actual cash flows from operating activities are listed directly.