In the long run, firms in monopolistic competition have excess capacity
Indicate whether the statement is true or false
TRUE
You might also like to view...
If the personal assets of the owners can be claimed if the business is bankrupt, the owners are said to have
A) a corporation type of business. B) limited liability. C) separation of ownership from control. D) unlimited liability.
Menu costs suggest that sticky prices are ____ for firms but _____ for the economy as a whole
a. optimal; suboptimal b. bad; good c. natural; unnatural d. suboptimal; optimal. e. suboptimal; suboptimal
The three principal factors that explain why the aggregate demand curve is downward sloping are
a. real wealth holdings, the interest rate, and international trade b. the price level, the interest rate, and economic growth c. the interest rate, the economic growth, and international trade d. cost-pull inflation, demand-pull inflation, and real wealth holdings e. the phases of the business cycle: recession, downturn, and recovery
For some economists, it is hard to refute the validity of the war-induced theory of business cycles because for World War I, World War II, and the Korean War, the war- induced expansion came
a. when the economy was in the upswing or peak phase of an already existing cycle b. when the economy was in the upswing or trough phase of an already existing cycle c. when the economy was in the downswing or trough phase of an already existing cycle d. when the war was already over, causing a downswing in an already existing cycle e. in the aftermath of each war