Free entry and exit means that the number of firms in the market adjusts until
a. producers continuously enter the market freely.
b. the market grows to a profitable level.
c. economic profits are driven to zero.
d. products are free.
c
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With respect to redistribution, one reason "The Big Tradeoff" exists is because
A) government programs employ resources that could have been productive elsewhere. B) government policymakers must choose between funding the various programs. C) government programs only employ resources that had no value to society otherwise. D) government programs only pay workers their opportunity cost.
If the spending multiplier is 3 and the desired amount of increase in real GDP is $90 million, then by how much would government spending have to increase??
A. ?$270 million. B. ?$90 million. C. ?$30 million. D. ?$0.
Ellie is spending her entire income on goods X and Y. Her marginal utility from the last unit of X is 100 and the marginal utility from the last unit of Y that she consumes is 50. Ellie's utility is only maximized if
A. the price of good X is twice that of good Y. B. the price of good Y is twice that of good X. C. the prices of X and Y are the same. D. We cannot determine whether Ellie is maximizing her utility.
Which of the following elements of GDP were affected by the financial crisis and the lack of available credit?
A. Consumption and business investment only B. Consumption and government spending only C. Consumption, business investment, and government spending only D. Consumption, business investment, government spending, and imports/exports