Because firms in perfectly competitive markets can sell any quantity without driving down prices, they should:
A. produce as much as possible to maximize profits.
B. produce at the lowest cost per unit to maximize profits.
C. try to flood the market.
D. increase quantity until the additional profit it earns on its last unit sold is zero.
D. increase quantity until the additional profit it earns on its last unit sold is zero.
You might also like to view...
If a firm in monopolistic competition is neither making a profit nor suffering a loss, its AR curve is
a. horizontal. b. touching its AVC curve. c. touching its ATC curve. d. below its MR curve.
Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real GDP and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. Real GDP rises, and reserve-related (central bank) transactions become more positive (or less negative). b. Real GDP rises, and reserve-related (central bank) transactions remain the same. c. Real GDP and reserve-related (central bank) transactions remain the same. d. There is not enough information to determine what happens to these two macroeconomic variables. e. Real GDP falls, and reserve-related (central bank) transactions remain the same.
For a pure monopoly to exist, which statement must be true?
Most economists feel that the ability to alter the unemployment rate with fiscal and monetary policies is ______.
a. more limited than previously believed b. more powerful than previously believed c. impossible d. easy