Which of the following is true about the long run operations of perfectly competitive firms?
a. They produce with productive efficiency.
b. They produce with allocative efficiency.
c. They earn zero economic profits
d. all of the above
d
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Which of the following is not a criticism of monopolies?
a. They restrict output. b. They set price above the perfectly competitive level. c. They tend to be less innovative than firms in a competitive market. d. They exert a disproportionate amount of political influence. e. They reduce allocative efficiency through perfect price discrimination.
George spent $20,000 to buy bonds issued by a public sector enterprise. According to a stockbroker, the amount spent by George is: a. saving
b. an investment. c. a tax to the government. d. a consumption expenditure.
Jose is rational if he
A. only responds to rewards that involve money. B. always uses a model or mathematical formula to help him make a decision. C. never makes a mistake in his life. D. does not intentionally make decisions that would leave him worse off.
According to the theory of comparative advantage, ________ raise(s) productivity by lowering opportunity costs.
A. economic growth B. investment in capital goods C. exchange and consumption D. trade and specialization