Modest shifts of the market marginal cost curve will have no impact on the production decision of a monopolistically competitive firm.
Answer the following statement true (T) or false (F)
False
Any shift in the market marginal cost curve will impact the demand curve and the production decision for the individual firm. For example, if more firms enter the market, the market marginal cost curve shifts to the right, driving down the average price. The firm's demand curve shifts to the left and becomes more elastic because more close substitutes (other firms) are available.
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Which is distributed more unequally, income or wealth? Why? Which is the better measure?
What will be an ideal response?
If marginal revenue is greater than marginal cost, the firm should
A) raise price. B) raise marginal revenue. C) increase its rate of output. D) decrease its rate of output.
Protection makes the people of a country better off.
Answer the following statement true (T) or false (F)
Refer to the figure below. If the price is $4 today and there is no change in either supply or demand, one would expect the price in the future to be:
A. greater than $6. B. $4. C. less than $4. D. greater than $4.