The characteristic that distinguishes a monopolistically competitive market from a perfectly competitive market is the:
a. ease of entry.
b. number of firms operating in the market.
c. degree of government regulation in the activities of the firms.
d. differentiation of products.
e. extent of market share of each firm.
d
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Refer to Figure 9-3. What is the value of the deadweight loss as a result of the quota?
A) $5.25 million B) $8 million C) $17.25 million D) $20 million
Classical economists would cite all of the following as reasons why the government cannot smooth out the business cycle except that
A) only productivity shocks can cause real fluctuations in the business cycle. B) the government has imperfect knowledge of the economy. C) political constraints on policy actions prevent the government from carrying out effective policies. D) time lags between the onset of a recession and the implementation of effective countermeasures make anti-recessionary macroeconomic policies impractical.
Which of these policy rule variables does NOT have the disadvantage of being hard to control?
A) nominal GDP growth B) high-powered money C) the unemployment rate D) the inflation rate
An index number is important only in a relative sense -- in comparison to an index number from another period
a. True b. False