How does the demand curve facing a monopoly firm compare with the demand curve facing a perfectly competitive firm?
What will be an ideal response?
The demand curve facing a perfectly competitive firm is perfectly elastic (horizontal). This occurs because a firm in a perfectly competitive market is a price taker with no control over price. In contrast, the demand curve facing a monopolist is the market demand curve since it is the only producer in the market. Thus, it will be downward sloping.
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Which of the following is most likely to reduce an individual's future spending?
A) Withdrawing money today B) Lending money today C) Paying back a loan in the future D) Withdrawing money in the future
If goods and services flow clockwise in a circular economic flow diagram, then consumption expenditures flow:
A. counterclockwise and firm revenues flow clockwise. B. counterclockwise and firm revenues flow counterclockwise. C. clockwise and firm revenues flow counterclockwise. D. clockwise and firm revenues flow clockwise.
Assume that the nominal exchange rate increases by 2%. If prices (both domestic and foreign do not change), we know that
A) domestic goods are now relatively cheaper. B) domestic goods are now relatively more expensive. C) foreign goods are now relatively cheaper. D) both B and C
A share of stock
A. is a fractional ownership of the firm. B. does not promise a fixed annual payment. C. gives the owner with other owners the right to pick the management of the company. D. all of the above.