Which of the following statements is FALSE?
A) A perfectly competitive market produces more output and charges a lower price than a monopoly.
B) A perfectly competitive firm produces where MR = MC but a monopoly produces where MR > MC.
C) In a perfectly competitive market, the price is equal to the marginal cost, but in a market with a single-price monopoly, price exceeds marginal cost.
D) The consumer surplus is smaller for a market with a monopoly than for a perfectly competitive market.
E) In the long run, a monopoly can earn a larger economic profit than can a perfectly competitive firm.
B
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Refer to Scenario 9.1. The Nash equilibrium occurs when Sheb places ________ sheep on the commons and Monty places ________ sheep on the commons
A) 4; 4 B) 4; 5 C) 5; 4 D) 5; 5
Which of the following is true?
i. Comparative advantage drives international trade. ii. Compared to a no-trade situation, imports make domestic producers better off. iii. Tariffs lower the domestic price of imported goods. A) Only i B) Only ii C) Only iii D) i and ii E) i and iii
According to the Keynesian IS—LM model, what is the effect of each of the following on output, the real interest rate, employment, and the price level? Distinguish between the short run and the long run
(a) Expected inflation rises. (b) Wealth increases. (c) Labor supply decreases due to a change in demographics. (d) The future marginal product of capital decreases.
If the economy has substantial unemployment, then the inflationary costs of expansionary policy are likely to be: a. low, and the unemployment gains minimal. b. low, and the unemployment gains large
c. high, and the unemployment gains minimal. d. high, and the unemployment gains large.