The above table shows the percent of sales held by the four largest firms in an industry
a) Calculate this industry's four-firm concentration ratio.
b) Is this industry competitive?
c) What market type does it most likely represent?
a) The four-firm concentration rate is 30 percent.
b) Because the four-firm concentration ratio is relatively low, the industry is competitive.
c) The industry is most likely monopolistic competition.
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A perfectly competitive producer is
A. a "price maker." B. a "price taker." C. both a "price maker" and a "price taker." D. neither a "price maker" nor a "price taker."
How will the purchase of $100 million of government securities by the Federal Reserve change bank reserves and total checking account deposits in the banking system as a whole? Assume that banks do not hold any excess reserves, that households and
firms do not change the amount of currency they hold, and that the required reserve ratio is 20 percent.
Exhibit 6-4 A marginal product curve
?
As shown in Exhibit 6-4, the law of diminishing returns applies in the range of:
A. over 1 workers per day. B. over 3 workers per day. C. between 0 and 3 workers per day. D. between 0 and 5 workers per day.
If a competitive firm maximizes short-run profits by producing some quantity of output, which of the following must be TRUE at that level of output?
A) p = MC B) MR = MC C) p ? AVC D) All of the above.