A single price monopolist has a demand curve: P = 500 - 50Q. It has the total cost curve: TC = 1000 + 100Q. If the firm is a profit maximizer or loss minimizer, what output and price should it plan for?
What will be an ideal response?
500 - 100Q = 100, 400 = 100Q, Q = 4, P = 300
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Which of the following would be most likely if firms in a competitive price-searcher market were earning economic profit?
a. Production inefficiencies would persist until the profit was eliminated. b. Firms would decrease their rate of output in the short run, causing a decline in profitability in the market. c. New firms would enter the market, resulting in fewer sales by existing firms. d. All firms in the market would continue to produce at their current levels and continue to charge the same price.
If two goods are close substitutes:
a. Consumers will always buy the one that has the lower price b. An increase in the price of one causes the demand for the other to decrease c. A decrease in the price of one causes an increase in the demand for the other d. A fall in the price of one will decrease the demand for the other
Refer to the information provided in Figure 13.9 below to answer the question(s) that follow. 
Figure 13.9 Refer to Figure 13.9. If competition is introduced into the market, the net social gain may be greater than the area BEC to the extent that
A. society may value the increase in consumer welfare on equity as well as efficiency grounds. B. the firm may have engaged in rent-seeking behavior, the cost of which would also be avoided. C. firms facing competition may have a greater incentive to cut costs and innovate, which results in gains to society. D. All of the above are correct.
Spending on goods from a country will ________ as the value of its currency gets cheaper against the U.S. dollar
A) increase B) decrease C) reverse D) go to other countries