Use the following graph for a monopolistically competitive firm to answer the next question.
A firm with which demand curve has more control over prices?
A. B, because its more elastic
B. A, because it's more inelastic
C. B, because it's more inelastic
D. A, because it's more elastic
Answer: C
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In monopolistic competition there is/are
A) only one seller who faces a downward-sloping demand curve. B) many sellers who each face a perfectly elastic demand curve. C) a few sellers who each face a downward-sloping demand curve. D) many sellers who each face a downward-sloping demand curve.
Which of the following is NOT a result of the ability of investors to hedge?
A) increased access to funds by firms and households B) investors are more willing to invest C) increased risk aversion D) slower economic growth
Consider the market for gasoline. Buyers
a. and sellers would lobby for a price ceiling. b. and sellers would lobby for a price floor. c. would lobby for a price ceiling, whereas sellers would lobby for a price floor. d. would lobby for a price floor, whereas sellers would lobby for a price ceiling.
The most likely advocates for a monetary rule would be:
A. Monetarists B. Real-business-cycle theorists C. Mainstream economists D. Supply-side economists