Consider an industry that is in long-run equilibrium. An increase in demand leads to no change in the price of the good. We know that this is
A. a decreasing-cost industry.
B. a constant cost industry.
C. an increasing-cost industry.
D. not a competitive industry.
Answer: B
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Oligopolistic firms tend to make large economic profits over time because
A. they have complete control in the market to charge any price they want. B. they produce at a point that is allocatively efficient. C. they charge higher than average total cost prices. D. they are productively efficient and produce the least costly way.
If an increase in investment leads to a bigger increase in national income this is called the:
a) Accelerator b) Aggregate demand c) Monetarism d) Multiplier
An in-kind gift causes the budget line to:
A. rotate counterclockwise. B. shift to the left in a parallel fashion. C. shift to the right in a parallel fashion. D. None of the statements is correct.
Which of the following statements is TRUE?
A. No economic model captures every detail that affects a problem. B. Economic models must fully reflect reality. C. Economic models always make accurate predictions about behaviors. D. Economic models use economists' opinions with no use of data.