In the short run, monopolistically competitive firms:
A. can earn positive economic profits by acting like a monopolist.
B. will earn zero economic profits by acting like a monopolist.
C. can earn positive economic profits by acting like a perfectly competitive firm.
D. will earn zero economic profits by acting like a perfectly competitive firm.
Answer: A
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The consumption function assumes that:
a. only disposable income affects consumption b. only the price level affects consumption. c. many factors other than disposable income affect consumption, and each is allowed to vary along the consumption function. d. factors other than disposable income affect consumption, but those are held constant along the consumption function. e. only consumer expectations affect consumption.
The principle of marginal productivity
a. is the same as the principle of marginal cost. b. helps explain the demand for each input. c. differs from industry to industry. d. allows the world's food to be grown in a flower pot.
The invention of new mining methods will affect price through the supply side.
Answer the following statement true (T) or false (F)
Winner-take-all markets explain
A. why no one ever remembers who came in second. B. why top paid corporate executives, professional athletes, and entertainers earn such high salaries. C. why nominal wages are always higher than real wages. D. why real wages are tied to productivity.