The major similarity between monopolistic competition and perfect competition is
A. both assume products are differentiated.
B. that both assume many buyers and sellers.
C. the shape of the demand curve.
D. price equals marginal revenue in each.
Answer: B
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Deflation refers to a:
a. decreasing relative prices. b. decreasing price level. c. slowing down of the rate of inflation. d. federal government policy of running budget surpluses.
A takeover implies that
a. the common shareholders buy out the bondholders b. the government takes over the corporation c. someone or a group is able to purchase all of the outstanding common stock in a corporation d. the board of directors takes control of the corporation e. a proprietorship sells out to a partnership
The figure shows the saving schedules for economies 1, 2, 3, and 4. Which economy has the highest marginal propensity to consume?
A. 1.
B. 2.
C. 3.
D. 4.
Assume the market was in equilibrium in the graph shown. If the market price were set to $6, which of the following is true?
A. For those still interacting in the market, some surplus is transferred from seller to buyer. B. Producers gain the surplus of those buyers who dropped out of the market. C. For those still interacting in the market, some surplus is transferred from buyer to seller. D. Consumers gain the surplus of those sellers who dropped out of the market.