Monopolistically competitive firms
a. are guaranteed to earn short-run economic profit
b. may earn short-run economic profits, although long-run economic profit is typically zero
c. may earn economic profit both in the short run and in the long run
d. earn zero economic profit both in the short run and in the long run
e. can only earn an economic profit in the inelastic portion of their demand curves
B
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Which figure above shows the effect of a technological advance in the production of pizza?
A) Figure A B) Figure B C) Figure C D) Figure D E) Both Figure A and Figure D
In the short-run macro model, which of the following increases when government spending increases?
a. The interest rate b. Investment spending c. Taxes d. Spending on consumer durables e. The money supply
When a country imposes and maintains price controls, inflation
A) can never occur. B) will result in a general surplus of goods and services. C) is felt through long lines of people wanting to buy goods. D) has been legislated away.
Government-sponsored goods are those goods
A) that society views desirable through the political process. B) that companies give away as promotional prizes. C) that have lower than average negative externality. D) that only low-income individuals consume.