Which of the following statements about a perfectly competitive market are TRUE?
I. The perfectly competitive industry faces an upward sloping labor supply curve.
II. The individual firm in a perfectly competitive industry faces a perfectly elastic labor supply curve.
A) I only
B) II only
C) both I and II
D) neither I nor II
Answer: C
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The above figure illustrates a firm's total revenue and total cost curves. Which one of the following statements is FALSE?
A) Economic profit is the vertical distance between the total revenue curve and the total cost curve. B) At output Q1 the firm makes zero economic profit. C) At an output above Q3 the firm incurs an economic loss. D) At output Q2 the firm incurs an economic loss.
Most economists support the infant-industry argument because it is so easy to implement in practice
a. True b. False Indicate whether the statement is true or false
The demand for money rises. According to the Keynesian transmission mechanism, the interest rate __________, investment spending __________ (assuming it is interest-sensitive), the AD curve shifts to the __________ and if the AS curve is horizontal, Real GDP __________
A) rises; falls; left; rises B) falls; rises; right; does not change C) rises; falls; right; rises D) falls; falls; left; does not change E) rises; falls; left; falls
The opening of a new American-owned factory in Algeria would tend to increase Algeria's GDP more than it increases Algeria's GNP because some of the income from the factory accrues to people who do not live in Algeria.
a. true b. false