Once a monopolistically competitive firm innovates, it is likely that:
A. it will need government protection to earn enough to cover its R & D costs.
B. it will enjoy long-run profits.
C. other firms will rush to create similar, highly substitutable goods.
D. None of these is likely to happen.
Answer: C
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In the factor market, firms ________ and households ________
A) hire land, labor, capital, and entrepreneurship services; purchase goods and services B) supply land, labor, capital, and entrepreneurship services; hire land, labor, capital, and entrepreneurship services C) pay rent, wages, interest, and profit; earn rent, wages, interest, and profit D) purchase goods and services; supply goods and services E) supply goods and services; purchase goods and services
Public choice analysis indicates that politicians will find
a. budget deficits more attractive than budget surpluses. b. budget surpluses more attractive than budget deficits. c. budget deficits attractive during an economic boom, but surpluses attractive during a recession. d. tax increases more attractive than increases in government spending.
If the expected rate of inflation rises, then the short-run Phillips Curve would:
A. Shift to the right B. Shift to the left C. Become vertical D. Become flat
An increase in demand is an increase in the quantity people are willing and able to purchase at ________.
Fill in the blank(s) with the appropriate word(s).