A firm that is a price taker can:
A. substantially change the market price of its product by changing its level of production.
B. sell all of its output at the market price.
C. sell some of its output at a price higher than the market price.
D. decide what price to charge for its product.
Answer: B
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For an increasing cost industry, the long-run supply curve has a(n) elasticity of supply
a. infinite. b. negative. c. positive. d. zero.
The classical model does a poor job of explaining the __________ because it assumes that the __________ always clears
a. long run; labor market. b. long run; financial market. c. short run; labor market. d. short run; financial market. e. short run; housing market.
During recessions, who would tend to call for more government spending?
A. Liberals B. Conservatives C. Both liberals and conservatives D. Neither liberals nor conservatives
All of the following statements describe a market economy except:
A. Government prescribes the market prices for goods and services B. Prices provide important signals to buyers and sellers C. The allocation of resources is determined by their prices D. The actions of buyers and sellers establish a product's price