In a perfectly competitive industry
A. there is apt to be a shortage of sellers of output.
B. firms can never make an economic profit.
C. no buyer or seller can influence the market price.
D. each firm is a price maker.
Answer: C
You might also like to view...
Refer to Table 2-9. What is Thailand's opportunity cost of producing one wristwatch?
A) 0.05 pounds of rice B) 20 pounds of rice C) 25 pounds of rice D) 60 pounds of rice
Firms that face downward-sloping demand curves for their output in the product market are called
A) price takers. B) monopolists. C) price dictators. D) price makers.
The effect of the February 2008 tax rebate on spending was reduced due to ________
A) the simultaneous missteps in monetary policy B) the negative impact of the policy on saving rates C) the recognition that the rebate did not constitute a permanent change in income D) the small size of the program
Which of the following is true of the classical model?
a. Changes in aggregate demand does not have any impact on the aggregate price level. b. The aggregate supply curve is perfectly elastic. c. An increase in aggregate demand increases the price level, output remaining unchanged. d. Changes in aggregate demand determines the equilibrium output of the economy. e. Real GDP and price level remain unchanged irrespective of changes in aggregate demand and supply.