Like the monopolist, the monopolistically competitive firm:
A. faces a downward sloping demand curve.
B. is a price taker.
C. sets the price where marginal cost equals marginal revenue; the demand curve doesn't matter.
D. All of these statements are true.
A. faces a downward sloping demand curve.
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If a perfectly competitive firm is maximizing its profit and is making an economic profit, which of the following is correct?
i. Price equals marginal revenue. ii. Marginal revenue equals marginal cost. iii. Price is greater than average total cost. A) i only B) i and ii only C) ii and iii only D) i and iii only E) i, ii, and iii
Which of the following firms is likely to have the highest market power?
A) A perfectly competitive firm B) A monopolistic competitor C) A monopoly D) An oligopoly with homogeneous products
If the demand for videotapes tends to be elastic, then a decrease in videotape prices means that people spend more on videotapes than before
Indicate whether the statement is true or false
According to the Taylor Rule: if the inflation rate is 2% and the GDP gap is 3%, what does the federal funds rate target equal?
A) 9.5 percent B) 7.5 percent C) 5.5 percent D) 8.5 percent