In long-run equilibrium for a monopolistically competitive firm, economic profit equals zero and thus the outcome is efficient.
Answer the following statement true (T) or false (F)
False
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Assume two locally owned used car dealerships that have been in direct competition for many decades. They have a choice of selling high-quality cars at a high price but also high costs because of the repairs that have to be made
The other choice is to sell low-quality cars at a low cost but market them as high quality cars. Explain using game theory why it is in the interest of both of these companies to continue to sell high-quality cars but it may not necessarily be in the interest of a new out-of-town dealership that has recently moved into town to do the same.
Which of the following will lead to an increase in the gross domestic product of a country, all other variables remaining unchanged?
A) An increase in imports B) An increase in consumption expenditure C) A fall in the expenditure incurred by the government D) A fall in the expenditure on investment goods
Assume all capital is owned by firms, rather than by households. Under this assumption, capital is paid according to the value of its marginal product
a. only if this income is transmitted to households in the form of interest. b. only if this income is transmitted to households in the form of dividends. c. only if this income is transmitted to households in the form of interest or dividends. d. regardless of whether this income is transmitted to households in the form of interest or dividends or whether it is kept within firms as retained earnings.
Brian’s Innovative Agriculture pays rent to the Tilfords to grow crops in their fields. This is an example of a ______ market.
a. factor b. labor c. product d. stock