In perfect competition, firms enter the market whenever the market price exceeds the minimum average variable cost
Indicate whether the statement is true or false
FALSE
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If two variables have the same rate of growth over the long run, their ratio will:
A) remain constant over the long run. B) initially decrease and then increase. C) decrease over the long run. D) increase over the long run.
Historians are in general agreement that
(a) railroads opened the country and were built at great risk ahead of demand, gambling on the future. (b) railroads sharply cut down transportation costs, linking the country together in all directions and spurring the nation's growth far in advance of anything that might otherwise have been achieved. (c) railroads were the single innovation of the 19th century that created a great leap forward in terms of American economic growth. (d) none of the above are true.
Internet auctions
a. allow specialized sellers to reach many customers at low cost b. allow specialized buyers to reach many sellers at low cost c. always take the form of a Dutch auction d. always take the form of an English open outcry auction e. are rapidly being replaced by continuous open outcry auctions
Joe is the owner of the 7-11 Mini Mart, Sam is the owner of the SuperAmerica Mini Mart, and together they are the only two gas stations in town. Currently, they both charge $3 per gallon, and each earns a profit of $1,000. If Joe cuts his price to $2.90 and Sam continues to charge $3, then Joe's profit will be $1,350, and Sam's profit will be $500. Similarly, if Sam cuts his price to $2.90 and Joe continues to charge $3, then Sam's profit will be $1,350, and Joe's profit will be $500. If Sam and Joe both cut their price to $2.90, then they will each earn a profit of $900.For Sam, cutting his price to $2.90 per gallon is a:
A. revenue-maximizing strategy. B. profit-maximizing strategy. C. dominant strategy. D. dominated strategy.