A difference between a perfectly competitive industry and a monopoly is that
A) in the long run, firms in a perfectly competitive industry make zero economic profit and a monopoly can make an economic profit.
B) a firm in a perfectly competitive industry can perfectly price discriminate but a monopoly cannot.
C) only monopolies have an incentive to maximize profit.
D) perfectly competitive firms can have a public franchise.
E) a barrier to entry protects perfectly competitive firms in the short run and protects a monopoly in the long run.
A
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If Dr. Giltscalpel's gross revenue doubled when he doubled his surgical fees, the demand for his services within the relevant price range would be
A) indeterminate. B) perfectly elastic. C) perfectly inelastic. D) unit elastic. E) none of the above.
The demand for an input used in a fixed proportions technology
A) is identical to the demand for the other inputs. B) is greater than the demand for the end product itself. C) lies below the demand for the end product itself. D) is the same as the demand for the end product itself.
Use the following statements to answer this question
I. To maximize profit, a firm will increase its advertising expenditures until the last dollar of advertising generates an additional dollar of revenue. II. The full marginal cost of advertising is the sum of the dollar spent directly on advertising and the marginal production cost that results form the increased sales that advertising brings about. A) Both I and II are true. B) I is true, and II is false. C) I is false, and II is true. D) Both I and II are false.
In the long run, if imports increase, then exports
A) will not change. B) will decrease. C) will also increase. D) will become zero.