In the long run, a monopolistically competitive firm earns small economic profits.
Answer the following statement true (T) or false (F)
False
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Which of the following would shift a nation's production possibilities frontier outward?
A) an increase in demand for the nation's products B) discovering a cheaper way to convert sunshine into electricity C) a decrease in the unemployment rate D) a law requiring workers to retire at age 50
Why might a producer practice price discrimination?
A) to maximize profits B) to maximize quantity demanded C) to make its products more affordable to those with low incomes D) to maximize economic efficiency
An entrepreneur is a(n)
a. individual who has much education b. organizer who seeks profitable opportunities and is willing to accept risks c. business organization that uses inputs to produce output d. administrator who runs an enterprise without accepting any risk of financial loss e. depot or storehouse for commercial products
Which of the following statements about the effects of an increase in government purchases is most accurate?
a. In the classical model, it will cause complete crowding out. In the short-run macro model, crowding out will be incomplete. b. In the classical model, it will cause incomplete crowding out. In the short-run macro model, crowding out will be complete. c. Crowding out will be complete in both the classical and short-run macro model. d. Crowding out will be incomplete in both the classical and short-run macro model. e. In the classical model, the increase in government spending will lead to a decrease in investment spending and autonomous consumption. In the short-run macro model, it will not.