In a monopolistically competitive industry
A) firms can make an economic profit in the long run because of barriers to entry.
B) the firms can never make an economic profit.
C) if firms are making an economic profit, new firms enter the industry.
D) firms can make an economic profit in the long run because of product differentiation.
C
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Consider the market for euros. Suppose the exchange rate is ________ its equilibrium. This means that the quantity of euros ________ is greater than the quantity of euros ________ and the exchange rate will ________
A) above; supplied; demanded; fall B) below; supplied; demanded; rise C) above; demanded; supplied; fall D) below; demanded; supplied; fall
Which of the following statements is true about optimal two-part tariff and perfect price discrimination for a given demand curve?
A) The total revenue received under an optimal two-part tariff could be greater than, less than, or equal to that received under perfect price discrimination, depending on the fixed-fee portion of the two-part tariff. B) The total revenue received under the two pricing schedules is the same. C) The total revenue received under an optimal two-part tariff is less than that received under perfect price discrimination. D) The total revenue received under an optimal two-part tariff exceeds that received under perfect price discrimination.
Which of the following shows a contrast between Economist A, who is concerned with individual liberty, and Economist B, who is concerned with an unfair distribution of power?
a. Economist A wants more government programs; Economist B wants to hire fewer government employees. b. Economist A wants more government programs; Economist B want less government involvement. c. Economist A wants to hire more government employees; Economist B want to lower taxes. d. Economist A wants less government involvement; Economist B wants more government programs.
Assume that smartphones are a normal good, and that the prices of smartphones have fallen in recent years. Over this same period, the price of the components used to produce smartphones has also fallen and consumer incomes have risen. Which of the
following best explains the falling prices of smartphones? A) The supply curve for smartphones has shifted to the right while the demand curve for smartphones has shifted to the left. B) The demand curve for smartphones has shifted to the right more than the supply curve has shifted to the right. C) The demand curve and the supply curve for smartphones have both shifted to the left. D) The supply curve for smartphones has shifted to the right more than the demand curve has shifted to the right.