If an economy is operating at a point inside the production possibilities curve,
What will be an ideal response?
its resources are being wasted
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The figure above shows a perfectly competitive firm. If the market price is $40 per unit, then the firm produces ________ units and makes an economic profit that is ________
A) more than 45; more than $400 B) 40; more than $400 C) 40; less than $400 D) 30; equal to zero E) 30; more than $250
Which of the following is not one of the theories that have emerged as alternatives to the HO model?
A) The human skills theory. B) The product life cycle theory. C) The similarity of preferences theory. D) All of the above have been suggested as alternatives to the HO model.
What portion of the demand curve will profit-maximizing monopolists choose to operate on: the inelastic portion or elastic portion? Why?
Which of the following is a difference between monopoly and perfect competition?
a. Positive economic profits earned by perfectly competitive firms result in deadweight loss, while positive economic profits earned by a monopoly result in the production of a socially efficient output level. b. Positive economic profits earned by firms in a perfectly competitive market attract new firms into the market, causing profits to increase over time, while barriers to entry protect a monopolist's profits. c. Positive economic profits earned by a monopolist attract new firms into the industry, while barriers to entry protect profits of a perfectly competitive firm. d. Positive economic profits earned by firms in a perfectly competitive market attract new firms into the market, causing profits to decrease over time, while barriers to entry protect a monopolist's profits.