Which of the following is NOT a characteristic of monopolistic competition?
A) Entry and exit is restricted.
B) Firms compete on price.
C) A large number of firms compete.
D) Firms compete on product quality.
Ans: A) Entry and exit is restricted.
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Human capital is
A. The ratio of labor to capital. B. The knowledge and skills possessed by the labor force. C. Able to increase only if the labor force grows. D. Insignificant in productivity advances.
The following figure shows the production-possibility curves for Canada (AB) and the rest of the world (CD). Suppose Canada begins to trade with the rest of the world. If, in the international market, one bushel of corn is exchanged for one liter of maple syrup, Canada will produce ________ bushels of corn and the rest of the world will produce ________ liters of maple syrup.
A. 90; 100 B. 70; 50 C. 35; 32.5 D. 0; 0
An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
A firm maximizes its profit at a level of output, where the additional revenue earned by selling an extra unit of the output is equal to the additional cost borne for producing that extra unit of the output
a. True b. False Indicate whether the statement is true or false