Which of the following is NOT a characteristic of monopolistic competition?
A) large number of sellers
B) sales promotion and advertising
C) homogeneous product
D) easy entry of new firms in the long run
Answer: C
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Any firm that has economies of scale will
A. Be able to produce at a lower unit cost as it increases production. B. Prefer to produce a small amount of total industry output. C. Face an upward-sloping long-run average total cost curve. D. Try to spread production over many plants.
If instead the government set the abatement standard at 50 million tons per year, would that standard be too lenient or too restrictive at the national level? Support your answer with specific values.
Hypothetically, suppose a recent study of hazardous waste abatement (A) arrives at the following national estimates for abating chemical solvents: MSB = 100 – 0.75A and MSC = 20 + 0.50A, where A is measured in millions of tons per year, and costs are measured in millions of dollars.
According to the Taylor rule, the Fed should raise the federal funds interest rate when inflation ________ the Fed's inflation target or when real GDP ________ the Fed's output target
A) rises above; drops below B) drops below; drops below C) rises above; rises above D) drops below; rises above
Which of the following is likely hardest to resell?
A) An Apple iPod B) A discount airline ticket you bought with your frequent flyer miles C) A used car D) The free spa treatment you won at a raffle