If positive economic profit exists in monopolistic competition, there is:
A) incentive for new firms to enter.
B) a motive for existing firms to increase prices.
C) proof that advertising works.
D) a motive for existing firms to decrease prices.
E) product differentiation.
Answer: A) incentive for new firms to enter.
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Given the production function Y = A if output grows by five percent, the capital input grows by five percent, and the labor input grows by two percent, calculate the Solow residual
Calculate the growth rates of output per worker and capital per worker.
Government can correct for negative externalities by
A) decreasing taxes. B) increasing taxes or regulation. C) allowing the market system to correct the problem. D) decreasing the costs to those responsible for the externality.
If indirect business taxes and depreciation were added to the national income, we obtain: a. Net National product
b. Gross National Product. c. Gross Domestic Product. d. Personal Income.
A stoppage on an automobile production line caused by a late delivery can cost up to __________________.
a. $1,000-$10,000 per minute b. $10,000-$20,000 per minute c. $10,000-$20,000 per minute d. $10,000-$50,000 per minute e. $10,000-$100,000 per minute