A major distinction between a monopolistic ally competitive firm and an monopolistic firm is that:
A. One is a price taker and the other is a price maker
B. A recognized interdependence exists between firms in one industry but not in the other
C. One always produces differentiated products and the other always produces a homogeneous product
D. One necessarily faces a downward-sloping demand curve and the other a horizontal demand curve
B. A recognized interdependence exists between firms in one industry but not in the other
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A government action that can help correct positive externalities is
A) a tax on producers of the good that provides external benefits. B) a subsidy to consumers of the good that provides external benefits. C) an effluent fee charged to producers of the good that provides external benefits. D) regulations aimed at reduced production by sellers of the good that provides external benefits.
"Creative destruction" in a market system is brought about by:
A. Entrepreneurship B. Striking workers C. Regulation by the government D. Money-based trade
You lend a friend $20,000 for a year. At the end of the year your friend agrees to pay you $21,100. The interest rate on this loan is
A. 4.50% B. 5.00%. C. 5.50%. D. indeterminate from this information.
Production of goods and services require different mixes of resources. Discuss the three different production resource intensities and give examples of each.
What will be an ideal response?