A monopolistically competitive market has characteristics that are similar to
a. a monopoly only.
b. a competitive firm only.
c. both a monopoly and a competitive firm.
d. neither a monopoly nor a competitive firm.
Answer: c. both a monopoly and a competitive firm.
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Sam Lewis owns a firm in New York City's garment district. If Sam keeps adding workers to use the same number of sewing machines, eventually the workplace will become so crowded that workers will get in each other's way. At this point
A) Sam should begin using a division of labor in his business. B) Sam's business will be in violation of safety rules that have been established by the New York City government. C) the marginal product of labor in Sam's business would be negative and his total output would decrease. D) Sam should encourage his workers to share their sewing machines.
As we move upward along a linear demand curve, the price elasticity of the demand:
A. increases. B. decreases. C. remains the same. D. increases up to the midpoint and then decreases.
If the elasticity of supply of labor is low and the elasticity of demand for labor is high, then workers pay most of the Social Security tax levied on labor
Indicate whether the statement is true or false
There is a technological advance in a perfectly market. Which of the following statements is NOT true?
A) As more firms begin to use the new technology, the market supply increases and the price falls. B) Technological change brings permanent gains to producers and temporary gains to consumers. C) In the new long-run equilibrium, all the old-technology firms have exited. D) In the long-run equilibrium, competition eliminates any short-run economic profit.