The firm in the figure above is in monopolistic competition. It will set a price equal to
A) $1.
B) $2.
C) $3.
D) more than $3.
C
You might also like to view...
For consumers, goods A and B are complementary goods. The cost of a resource used in the production of A decreases. As a result
A) the equilibrium price of B will fall and the equilibrium price of A will rise. B) the equilibrium price of B will rise and the equilibrium price of A will fall. C) the equilibrium prices of both A and B will rise. D) the equilibrium prices of both A and B will fall.
Schleppsi, a soft drink maker, is a monopsonist in the county where it manufactures all of the Diet Schleppsi it produces. Suppose the current daily labor cost to the firm is $35,000 with 99 workers and the total wage cost with 100 workers would be $36,000 . What will the market wage be if Schleppsi hires the 100th worker?
a. $35. b. $36. c. $100. d. $350. e. $360.
Suppose inflation is a threat because the current aggregate demand curve will increase by $600 billion at any price level. If the marginal propensity to consume is 0.75, federal policymakers can follow Keynesian economics and restrain inflation by:
a. decreasing tax revenues by $600 billion. b. decreasing government spending by $200 billion. c. increasing tax revenues by $200 billion. d. increasing government purchases by $150 billion.
Which of the following statements best describes economic efficiency?
a. Economic efficiency occurs when all choices on the production possibilities frontier show productive efficiency because an increase the quantity of one good will also increase the quantity of another. b. Economic efficiency occurs when no choices on the production possibilities frontier show productive efficiency because an increase the quantity of one good will also increase the quantity of another. c. Economic efficiency occurs when all choices on the production possibilities frontier show productive efficiency because an increase the quantity of one good will decrease the quantity of another. d. Economic efficiency occurs when no choices on the production possibilities frontier show productive efficiency because an increase the quantity of one good will decrease the quantity of another.