A decrease in the price of spaghetti is likely to cause:
A. a movement to the right along the demand curve for spaghetti.
B. an inward shift of the demand curve for spaghetti.
C. an outward shift of the demand curve for spaghetti.
D. a movement to the left along the demand curve for spaghetti.
A. a movement to the right along the demand curve for spaghetti.
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Maxine's Cookie Shop sells chocolate chip cookies in a perfectly competitive market for $2 per dozen. Maxine currently produces 200 dozen cookies per day and average total cost at this level of production is $1.75
What level of profit is this firm earning? Explain.
In the Great Depression, the financial sector collapsed, as
A) banks engaged in ruinous competition. B) the stock market boomed, so people withdrew most of their funds from banks and invested heavily in stocks. C) the bond market boomed, so people withdrew most of their funds from banks and invested heavily in bonds. D) many banks closed.
How are the monopolistically competitive producer and the monopolist different?
a. The monopolist has zero barriers to entry and exit, but the monopolistically competitive producer has many such barriers. b. The monopolist has an upward-sloping demand curve, but the monopolistically competitive producer has a horizontal demand curve. c. The monopolist can make economic profits in the long run, but the monopolistically competitive producer cannot. d. The monopolist has many competitors, but the monopolistically competitive producer does not.
Government purchases exclude spending by the government for resources such as labor.
Answer the following statement true (T) or false (F)