Firms in monopolistic competition charge prices that are ________ those of the other firms in the market
A) close to
B) very different from
C) the same as
D) completely unrelated to
A
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For the purpose of measuring the cost of living for consumers, one reason the GDP price index is NOT a good substitute for the CPI is because the GDP price index
A) compares a current year basket of goods with a base year basket of goods. B) compares current year's prices with base year's prices. C) includes the prices of exported goods, which are not consumed in the United States. D) and the CPI move in the same direction over time. E) has a larger bias than does the CPI.
For a number of years country A had inflation of 3% but for the last five years has had inflation of 6%. Country B had inflation of 4% for many years, but very recently inflation unexpectedly rose to 9%. Other things the same, in which of the countries would the higher inflation rate be more likely to reduce unemployment?
a. both country A and country B b. neither country A nor country B c. country A but not country B d. country B but not country A
Which situation would most likely cause a nation's production possibilities curve to shift inward?
A. An increase in foreign trade B. The destruction from bombing and warfare in a losing military conflict C. An increase in the number of skilled immigrant workers D. The construction of more capital goods
Firm 1 and firm 2 compete as a Cournot oligopoly. There is an increase in marginal cost for firm 1. Which of the following is NOT true?
A. Firm 1 will produce less. B. Both firm 1's and firm 2's reaction functions are shifted. C. Firm 2 will produce more. D. Profits of firm 1 will decrease.