Which of the following statements is true?
A) The marginal entrant in a market earns the highest profit.
B) The marginal entrant has the lowest cost among all firms in the market.
C) Difference in technology and experience can lead to firms having non-identical costs even under perfect competition.
D) In a market that has identical cost structures for all firms, there is possibility of positive economic profits in both the short run and the long run.
C
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Aggregate expenditure is total
A. value added in the economy. B. income of households, businesses, governments, and foreigners. C. spending on final goods and services. D. revenue from the sale of goods and services.
If you purchase one pound of apples the price is $1.50 per pound. If you buy a five pound bag of apples, the cost is $5.00. This is most likely an example of
A) quantity discounts. B) lower marginal cost. C) lower marginal benefit. D) price gouging.
Monopolistic competition means:
A. a market situation where competition is based entirely on product differentiation and advertising. B. a large number of firms producing a standardized or homogeneous product. C. many firms producing differentiated products. D. a few firms producing a standardized or homogeneous product.
The "statistical discrepancy" that the NIPA includes in the data is to account for the following, except:
A. To equalize GDP totals produced by the expenditures approach and the income approach B. Errors due to people misrepresenting their incomes on their tax returns C. Difficulty in accurately estimating depreciation D. Household production, or "do-it-yourself" activities of households