In pure competition, if the market price of the product is initially higher than the minimum average cost of the firms, then:
A. Some firms will exit the industry and the industry supply will decrease
B. Other firms will enter the industry and the industry supply will increase
C. Some firms will exit the industry and the industry supply will increase
D. Other firms will enter the industry and the industry supply will decrease
B. Other firms will enter the industry and the industry supply will increase
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In which of the following have pension funds invested the most?
A) corporate equities and mutual fund shares B) government securities C) corporate bonds D) mortgages
According to Coase, the efficient solution to an externality problem depends on which party can avoid the problem at the lower cost. Thus when property rights are assigned to one party or another, the two parties will agree on the efficient solution to an externality problem as long as transaction costs are low, regardless of which party is assigned the property right
Indicate whether the statement is true or false
Suppose the supply of coal is perfectly inelastic, and the price elasticity of demand for coal is -0.4. If the government imposes a binding price ceiling for coal at a price that is 20 percent below the market equilibrium price, what is the impact of this policy on the market quantity?
A. Excess demand equals 16 percent of the market equilibrium quantity. B. Excess demand equals 80 percent of the market equilibrium quantity. C. The policy does not affect the market quantity. D. Excess demand equals 8 percent of the market equilibrium quantity.
George is a gift giver and Roger is a gift recipient. George has Roger in his utility function, but Roger does not have George in his utility function. Roger may try to get George to __________________ George's efficient number of gifts to (give)
A) give more gifts to him than B) reduce the number of gifts he receives below C) increase the number of gifts he receives beyond D) a and b E) a and c