An effective price floor results in a shortage.
Answer the following statement true (T) or false (F)
False
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The entry and exit of firms in a monopolistically competitive market guarantee that
A) firms can earn economic profits in the long run. B) price equals average total cost in the long run. C) marginal revenue equals marginal cost and average total cost is minimized. D) firms can earn economic profits in the short run.
To determine whether a market is perfectly competitive, economists examine the
A. number of firms in the market. B. similarities among the products of the different firms in the market. C. ease of entry and exit by firms in the market. D. All of the responses are correct.
If government taxes a firm which pollutes this will:
a. increase the demand for the good produced. b. decrease the supply of the good produced. c. increase the equilibrium quantity of the good produced in the market. d. decrease the equilibrium price of the good produced in the market. e. all of these.
The supply curve of books (which are produced using paper made from trees) will shift to the left in response to
a. a decline in college tuition. b. an increase in home building. c. an increase in the supply of lumberjacks. d. an end to government regulations that limit timber harvesting in national forests.