Perfect competition occurs in a market where there are many firms each selling:
A) identical product.
B) similar product.
C) unique product.
Answer: A) identical product.
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Under the least squares assumptions for the multiple regression problem (zero conditional mean for the error term, all Xi and Yi being i.i.d., all Xi and ui having finite fourth moments,
no perfect multicollinearity), the OLS estimators for the slopes and intercept A) have an exact normal distribution for n > 25. B) are BLUE. C) have a normal distribution in small samples as long as the errors are homoskedastic. D) are unbiased and consistent.
According to the search model, the marginal cost of acquiring information about a product
a. is greater for a doctor than a nurse's aide b. is the same for high-income consumers as for low-income consumers c. is greater for expensive items than for cheap items d. is greater for cheap items than for expensive items e. diminishes as more information is acquired
Net exports is calculated by:
A. adding total exports and total imports together. B. subtracting total exports from total imports. C. subtracting total imports from total exports. D. None of these is correct.
Another term for the opportunity cost of capital is
A) the normal interest rate. B) the normal rate of return. C) a normal profit. D) a normal wage rate.