Which of the following four firms would most likely be part of a perfectly competitive market?
A) Village Pizza sells NY style pizza and hard-to-find microbrews in a college town.
B) The WaveHouse is the only place in San Diego where you can ride an indoor 10 foot wave.
C) Mark sells the tomatoes he grew in his backyard at the local farmers market.
D) Amara Massage specializes in pre- and post-natal massage.
C
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In the figure above, with the rent ceiling
A) there is a shortage of 3,000 units. B) there is a surplus of 3,000 units. C) there is a surplus of 2,000 units. D) there is a shortage of 1,000 units. E) the market is in equilibrium.
All else equal, an increase in net exports accompanied by a decrease in expected future profits would definitely result in
A) an increase in the equilibrium real interest rate. B) a decrease in the equilibrium real interest rate. C) an increase in the equilibrium level of saving and investment. D) a decrease in the equilibrium level of saving and investment.
In the long run in a perfectly competitive market:
A. firms earn zero economic profits. B. firms operate at an efficient scale. C. supply is perfectly elastic when all firms have the same cost structure. D. All of these are true.
Which of the following mechanisms helps output to return to potential after a supply shock?
a. A change in the nominal wage b. Changes in business decision making strategies c. Changes in the capital stock d. The rigidity of the price level e. Changes in inventories