Because a monopolistic competitor has some monopoly power, advertising to increase that monopoly power makes sense as long as:
A. the marginal cost of advertising is positive.
B. the marginal cost of advertising exceeds the marginal benefit of advertising.
C. the marginal benefit of advertising is positive.
D. the marginal benefit of advertising exceeds the marginal cost of advertising.
Answer: D
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Erbia can produce both corn and wheat using fewer inputs than Glassen; however, Glassen can produce corn at a lower opportunity cost than Erbia. Therefore, we can conclude that Glassen has a comparative advantage in wheat production
a. True b. False Indicate whether the statement is true or false
Unemployment is a:
A. lagging indicator, because the business cycle follows it. B. lagging indicator, because it follows the business cycle. C. leading indicator, because the business cycle follows it. D. leading indicator, because it follows the business cycle.
Suppose two firms are in a game situation, and they each must decide on a strategy regarding whether to select a high price or a low price. Profits for a firm are highest when it selects a low price, while the other selects a high price; profits are
lowest if one selects a high price, while the other selects a low price; profits are in between when both select low prices; and profits are slightly higher when both select high prices. In the absence of collusion we expect A) one of the firms to select a high price and the other a low price. B) one firm to select a high price and the other a low price in the first period, followed by a reversal in the second period. C) both to select high prices. D) both to select low prices.
U.S. government debt as a percentage of GDP has been:
A. falling steadily since World War II. B. unchanged since World War II. C. increasing steadily since World War II. D. fluctuating since World War II.