As long as firms currently in a monopolistically competitive market are earning profits:
A. more firms will enter the market with products that are close substitutes.
B. the firm will lower its price to keep out competitors.
C. the government will step in to regulate prices to ensure they stay competitive.
D. more firms will leave the market before the profits are competed away.
Answer: A
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Refer to the figure below.________ inflation will eventually move the economy pictured in the diagram from short-run equilibrium at point ________ to long-run equilibrium at point ________. 
A. Rising; A B. Falling; A; C C. Falling; B: C D. Rising; A; C
To show how a variable ________, we typically use a ________
A) relates to another variable; time-series graph B) relates to another variable; pie chart C) changes over time; time-series graph D) changes over time; cross section graph E) changes over time; cross time chart
A perfectly competitive, increasing cost industry is initially in long run equilibrium. Then, there is an increase in demand. Compared with the initial equilibrium, once the new long run equilibrium is reached: a. price will be higher and total output will be greater than before
b. price will be the same and total output will be greater than before. c. price will be lower and total output will be greater than before. d. price will be higher, and therefore total output will be smaller than before.
Which of the following is an example of a compensating differential?
a. Two workers with different levels of on-the-job training earn different salaries. b. Two workers whose jobs entail different working conditions earn different salaries. c. Two workers whose jobs require different levels of technical expertise earn different salaries. d. Two workers with different levels of natural ability earn different salaries.