When a second firm enters a monopolist's market:
A. market price will rise.
B. the quantity produced by the first firm will increase.
C. the first firm's profits will decrease.
D. All of these will occur.
Answer: C
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As of 2008, the members of the WTO account for 97 percent of the world's international trade
Indicate whether the statement is true or false
If the marginal rate of return expected from a purchase of equipment is greater than the market interest rate, the firm should
a. not purchase the equipment b. purchase the equipment c. either purchase or not purchase the equipment, depending on the marginal resource cost d. inform stockholders that the company expects a decrease in earnings from the purchase e. seek government assistance in raising market interest rates
If a change in the price of a good results in no change in total revenue, then
a. the demand for the good must be elastic. b. the demand for the good must be inelastic. c. the demand for the good must be unit elastic. d. buyers must not respond very much to a change in price.
If the cross-price elasticity of demand between lettuce and salad dressing is negative, then when the price of lettuce rises, the demand for salad dressing will ________.
A. remain the same B. increase C. decrease D. become more inelastic