Which is a characteristic of monopolistic competition?
A. Standardized product.
B. Absence of nonprice competition.
C. A relatively small number of firms.
D. Relatively easy entry.
Answer: D
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If new firms enter the computer manufacturing industry, then, holding all other things constant,
A. each “old” manufacturer must sell fewer computers than before. B. some “old” manufacturers must exit the industry. C. the equilibrium price of computers will rise. D. the equilibrium quantity demanded of computers will rise.
Refer to Figure 5-1. At the market equilibrium, the deadweight loss is equal to
A) $0. B) $500,000. C) $1,000,000. D) $2,000,000.
The multiplier will be smaller, other things being equal: a. the smaller the fraction of each dollar earned that goes to taxes
b. the larger the MPC. c. the smaller the fraction of each dollar of disposable income that goes to saving. d. None of the above are true.
Trish grows oregano in her backyard to use in her homemade pesto sauce. How is this gardening included in GDP?
a. It is included in real GDP. b. It is included in nominal GDP. c. It is not included in GDP. d. It is included as an intermediate good.