The demand curve a monopoly faces is
A) horizontal.
B) vertical.
C) upward sloping.
D) downward sloping.
Answer: D
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Which of the following statements best summarizes the law of diminishing marginal returns?
A) In the short run, as more labor is hired, output diminishes. B) In the short run, as more labor is hired, output increases at a diminishing rate. C) In the short run, the amount of labor a firm will hire diminishes as output increases. D) As more labor is hired, the length of time that defines the short run diminishes.
To what does the "GDP gap" refer?
a. The difference between real and nominal GDP. b. The difference between this year's real GDP and last year's GDP. c. The difference between "full-employment" real GDP and actual real GDP. d. The difference between real GDP in the prior trough and real GDP in a current trough of the business cycle.
Which of the following is LEAST likely to be an example of a normal good?
A. Store-brand breakfast cereal B. Motor vehicles C. Routine medical care D. Housing
Compared with a firm in a perfectly competitive market, the demand curve faced by a monopolistically competitive firm is
A. perfectly elastic. B. more elastic. C. more inelastic. D. perfectly inelastic.