Monopolistically competitive firms try to ______ because P ? MC.
a. reduce customer expectations
b. reduce customer demand
c. keep the same number of customers
d. attract more customers
d. attract more customers
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Answer the following statement(s) true (T) or false (F)
1. If a market is perfectly competitive, allocative efficiency is achieved at the point where the profit-maximizing firm produces. 2. If a firm maximizes output from a stock of available resources, it must be achieving allocative efficiency. 3. Consumer surplus is the net gain to the firm measured as the excess of price over the marginal cost of production summed over all units sold. 4. If a consumer is willing to pay more for a good than he/she actually must pay, he/she enjoys a gain for that unit of output known as consumer surplus. 5. The sum of the change in consumer surplus plus the change in producer surplus is called deadweight loss to society.
The imposition of a binding price floor on a market
a. causes quantity demanded to be greater than quantity supplied. b. causes quantity demanded to be less than quantity supplied. c. causes quantity demanded to be equal to quantity supplied. d. causes a decrease in demand.
Which nation achieved the ideal communist society as described by Marx?
A. Castro's Cuba B. Mao's China C. Stalin's Soviet Union D. No nation has achieved Marx's vision of communist society.
Refer to the consumption schedule above. The average propensity to save at income level B is represented by:
A. 0C/0B
B. EF/BE
C. EF/BF
D. DE/AB