Refer to Figure 26.4 for a monopolistically competitive firm. If the firm currently faces Demand1 and MR1, then it will earn
A. Zero economic profit, and neither entry nor exit will occur.
B. A negative economic profit, and firms will exit the industry.
C. A negative economic profit, and firms will enter the industry.
D. A positive economic profit, and firms will enter the industry.
Answer: B
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When a price ceiling is set below the equilibrium price,
a. the quantity demanded will exceed quantity supplied. b. the quantity supplied will exceed the quantity demanded. c. the quantity supplied will equal the quantity demanded. d. the equilibrium price will fall.
Assume that the professors at a local college have gone without a pay increase for 4 years during a tough time. Suppose that things start to look up and the President of the college wants to make up for lost time. If the CPI in 2002 was 150 and 175 in 2006, how much will salaries have to increase to bring the faculty back up to their real income from 2002?
a. 175.0% b. 150.0% c. 25.0% d. 16.7% e. 14.3%
If the government were to regulate the way AT&T presents its phone plans, such a policy would be a:
A. tariff. B. nudge. C. tax. D. push.
Refer to Figure 2-8. If Vidalia chooses to produce 60 dozen orchids, how many roses can it produce to maximize production?
A) 30 dozen roses B) 50 dozen roses C) 100 dozen roses D) 150 dozen roses