When new firms enter a monopolistically competitive industry, each existing firm's
A) demand curve shifts rightward.
B) demand curve shifts leftward.
C) marginal cost curve shifts rightward.
D) marginal cost curve shifts leftward.
B
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In the short run, lowering the federal funds rate shifts the aggregate demand curve ________ so that real GDP ________ and the price level ________
A) leftward; decreases; rises B) rightward; increases; rises C) rightward; decreases; rises D) leftward; decreases; falls E) rightward; increases; falls
Which of the following statements is true of the equilibrium price of a good?
a. The equilibrium price of a good is the price where the quantity demanded of the good is equal to the supply of the good. b. The equilibrium price of a good is the price where the quantity demanded of the good is equal to the quantity supplied of the good. c. The equilibrium price of a good is the price where the demand for the good is equal to the supply of the good. d. The equilibrium price of a good is the price where the demand for the good is equal to the quantity supplied of the good.
Considering the data on real and nominal interest rates for the U.S. from 1979 to 2012, which of the following statements is most accurate?
A. The real interest rate remains unchanged over time. B. The inflation rate is always greater than the real interest rate. C. There have been times when the real interest rate has been negative. D. Nominal interest rates higher in 2000 than they had been at any other point in time.
Figure 16.1A firm that generates pollution is illustrated in Figure 16.1. The government has chosen to impose a pollution tax equal to P2. From the firm's point of view, the marginal benefit of abatement is:
A. avoiding the pollution tax imposed by the government. B. the positive publicity the firm will receive by having a "green" production plant. C. the reciprocal of the marginal cost of abatement. D. zero because abatement benefits the general public, not the firm.