In monopolistic competition there is an under-allocation of resources at the profit-maximizing level of output, which means that
A. price is greater than minimum ATC.
B. price is greater than MR.
C. price is greater than MC.
D. ATC is not equal to MC.
Answer: C
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Bid-rigging is more likely when
a. auctions are larger b. auctions are frequent c. auctions generate different sets of potential bidders d. the auctioneer is paid on commission rather than a fixed fee
Firms have incentive to enter a monopolistically competitive market if:
A. positive profits are being earned and the price is below MC. B. zero profits are being made and they can duplicate the product exactly. C. positive profits are being earned and they can create a similar product. D. zero profits are being made and they can create a similar product.
If Coca-Cola opens a bottling plant in Brazil, what effect would it have on that country's Gini coefficient?
Recall the Application about the policies used by the European Union to support the agricultural sectors of is member countries to answer the following question(s). According to this Application, the policies used by the European Union to support the agricultural sectors of its member countries created excess supply. Excess supply can be generated if a government establishes a:
A. price ceiling below the market equilibrium price. B. price ceiling above the market equilibrium price. C. price floor below the market equilibrium price. D. price floor above the market equilibrium price.