In the long run, the price charged by a monopolistic competitor will:
a. equal marginal cost
b. equal average total cost.
c. equal marginal revenue.
d. be characterized by both b. and c.
b
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Refer to Figure 28-2. Suppose the economy is at point A. The Fed uses expansionary monetary policy to lower the unemployment rate permanently below the level associated with A. Which of the following will occur?
A) Inflationary expectations will decline. B) Unemployment will rise above the natural rate. C) Unemployment will accelerate in the long run. D) Inflation will accelerate in the long run.
During recessions, even with no changes in policy, the deficit tends to ______ because _____________
Fill in the blank(s) with correct word
There is a flexible exchange rate system and only two countries in the world, the United States and Mexico. The real interest rate in the United States rises relative to the real interest rate in Mexico. It follows that
A) the dollar will depreciate and the peso will appreciate. B) the peso will depreciate and the dollar will appreciate. C) both the peso and the dollar are likely to appreciate. D) both the peso and the dollar are likely to depreciate.
The marginal cost of a unit of labor in a perfectly competitive labor market is
A. equal to product price. B. the market wage rate. C. equal to MRP. D. its average MRP.