A monopolist will ________ if marginal revenue is negative.
A. maintain its current production level
B. increase production
C. not produce
D. shut down
Answer: C
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Because economic profits are eliminated in the long run in monopolistic competition, to earn an economic profit firms continuously
A) shut down. B) exit the industry. C) innovate and develop new products. D) declare bankruptcy. E) decrease their costs by decreasing their selling costs.
The figure above shows the U.S. demand and U.S. supply curves for cherries. At a world price of $2 per pound once international trade occurs, the total exports of cherries from the United States to other nations equals
A) 200,000 pounds. B) 400,000 pounds. C) 600,000 pounds. D) 800,000 pounds. E) 0 pounds.
Assuming that bus travel is an inferior good, a decrease in consumer income, other things being equal, will cause:
a. a downward movement along the demand curve for bus travel. b. no change in the demand curve for bus travel. c. an upward movement along the demand curve for air travel. d. a rightward shift in the demand curve for bus travel.
________ is an industry market structure with many firms each able to differentiate their products.
A. Perfect competition B. An oligopoly C. A monopoly D. Monopolistic competition