There Are Four Ice Cream Shops on a Small Tourist

question 30

Multiple Choice

There are four ice cream shops on a small tourist island.The following table shows the quantity of ice cream cones that each firm produces in a typical year and the price that each firm currently charges for each ice cream cone it sells.An economist might suspect ________ collusion occurring in this market where ________ is the price leader and all other firms set price to match the price leader.

• A) explicit; Royal Scoop
• B) explicit; Cream Emporium
• C) illegal; Cream Emporium
• D) tacit; Royal Scoop
• E) tacit; Cream Emporium

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Definitions:

Savings

The portion of income not spent on consumption of goods and services but kept aside, usually in deposit accounts or investments.

Disposable Income

The fiscal capacity for households to commit to spending and saving following income taxation.

Savings

The portion of income not spent on consumption but kept aside for future use, often in a bank or other financial instruments.

Liquid Assets

Refers to assets that can be quickly and easily converted into cash without significant loss in value.