If we observe firms earning zero economic profits in the short run, we know that
A) the industry must be perfectly competitive.
B) the industry must be either perfectly competitive or monopolistically competitive.
C) there must not be any barriers to entry.
D) any market structure is possible since firms under any market structure can earn zero profits at some time.
Answer: D
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From a strictly economic perspective, immigration should be:
A. Expanded until its marginal benefits equal its marginal costs B. Expanded until its total benefits equal its total costs C. Expanded as long as its marginal costs exceed its marginal costs D. Reduced if its marginal benefits exceed its marginal costs
Two competing firms in a duopoly must decide whether or not to offer consumers a coupon for their good. The payoff matrix above represents the daily profit available to the firms under the different coupon strategies
a. What strategies and payoffs are represented by quadrant A? b. What strategy will Firm 1 pursue if it believes that Firm 2 is offering a coupon? c. What quadrant represents the equilibrium that will result if the firms act independently (compete)? d. What quadrant represents the equilibrium that will result if the firms successfully collude?
Some sales managers are talking shop. Which of the following quotations refers to a movement along the demand curve?
A) "Since our competitors raised their prices our sales have doubled." B) "It has been an unusually mild winter; our sales of wool scarves are down from last year." C) "We decided to cut our prices, and the increase in our sales has been remarkable." D) none of the above
High value-added per employee is associated with:
a. capital intensive industries. b. labor intensive industries. c. the shoe industry in 1860. d. the use of unskilled labor.