Author Question: If both firms in a duopoly cheat on a collusive agreement, the price ________ and both firms are ... (Read 109 times)

sarasara · **on:** Jun 29, 2018

If both firms in a duopoly cheat on a collusive agreement, the price ________ and both firms are ________.

A) falls; better off
B) rises; worse off
C) falls; worse off
D) rises; better off

Question 2

In the foreign exchange market, how does a fall in the U.S. interest rate affect the supply of dollars?

What will be an ideal response?

jrpg123456 · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

C

Answer to Question 2

The fall in the U.S. interest rate increases the supply of dollars as U.S. residents supply more dollars in order to obtain foreign currency with which to buy foreign assets that now have relatively higher interest rates.