What will happen when a monopolistic competitive firm increases its price?
a. It will lose all its customers like a perfect competition firm.
b. It will lose only a few of its customers like a monopolist.
c. It will lose fewer customers than under perfect completion but more than a monopolist.
d. It will not lose any customers.
c. It will lose fewer customers than under perfect completion but more than a monopolist.
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Since most people prefer more money to less, the desire for more money
A) makes it difficult to induce people to cooperate. B) makes it difficult to induce people to sacrifice for the larger public good. C) makes social order highly unstable and unpredictable. D) can induce useful changes in behavior. E) implies people are living in a capitalist society.
Perfectly inelastic demand is represented by a demand curve which is ________, and relatively inelastic demand is represented by a demand curve which is ________
A) upward sloping; horizontal B) horizontal; downward sloping C) downward sloping; vertical D) vertical; downward sloping
Why is the marginal product of labor for Moe’s higher with two employees than it is with more workers?
a. Adding a second worker yields the biggest efficiency gain.
b. It is less expensive to pay only two workers than for three or more workers.
c. Variable costs are higher with fewer workers.
d. The second worker is the best employee.
The main effect on the economy of the financial sector crisis in late 2008 was
A. reduced aggregate supply. B. increased aggregate demand. C. reduced aggregate demand. D. increased aggregate supply.