In a competitive market, each firm earns ________ economic profits, whereas firms in a successful cartel will earn ________.
Fill in the blank(s) with the appropriate word(s).
Answer: zero; positive economic profits
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Transaction costs are likely to be ________ when property rights are ________ clearly defined
A) lower ; less B) higher; more C) lower; more D) Trick question: there is no causal relationship between transaction costs and property rights.
How do you calculate consumer’s surplus? What happens to consumer’s surplus when the price of a commodity rises?
What will be an ideal response?
The period of modern economic growth occurred from ________________________ onward.
a. 1776 b. the 1870s c. the 1920s d. the 1950s
Before the Great Depression of the 1930s, most economists believed that
A. only active government policy could prevent recessions or inflation. B. a capitalist economy had a natural tendency to cure recessions or inflation. C. a capitalist economy had a natural tendency to inflation. D. recessions and depressions were inevitable until the economy broke down completely.