Under perfect competition, entry of new firms into the market in the long run tends to:
a. raise the aggregate supply.
b. raise the level of profit of the existing firms.
c. raise the aggregate demand for goods.
d. reduce the degree of competitiveness in the market.
e. reduce the market power of the existing firms.
a
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Refer to Figure 13-1. Ceteris paribus, an increase in government spending would be represented by a movement from
A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.
With a flexible exchange rate, a nation can choose an inflation rate independent of the rest of the world
Indicate whether the statement is true or false
President Woodrow Wilson
(a) fostered the growth of government bureaucracy. (b) quickly returned the U.S. economy to a competitive market place. (c) remained neutral on the issue of whether the federal government should intervene in private market affairs. (d) mandated that Congress operate with a balanced budget.
The "capture" in the capture hypothesis occurs because
A) regulators try to promote everyone's best interest. B) society doesn't care for regulatory agencies. C) regulators always know what is in society's best interest. D) regulators usually have been or will be associated with the industries they regulate.