A monopolistic competitor that earns profits in the current period is likely to expect:
a. a loss in the future due to diseconomies of scale
b. the entry of firms with similar yet differentiated products in the long run.
c. higher profits in the future due to barriers to entry.
d. entry of new firms with identical products.
b
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
The study of economic mobility discussed in the text pinpoints five factors that are correlated with economic mobility. What are those five factors and how do they affect economic mobility?
What will be an ideal response?
The simple accelerator theory suggests that investment will be rising when
A) output is rising. B) the growth of output is rising. C) output is high. D) the growth of output is high.
Let Qd = 10 - 2P and Qs = 3P be the demand and supply curves for Beer. The equilibrium combination (P* and Q*) in the market is ________.
A. P* = 5; Q* = 0 B. P* = 2; Q* = 5 C. P* = 2; Q* = 6 D. P* = 6; Q* = 2