Advertising:
A. can cause perceived differences that don't exist and drive prices up.
B. can convey useful information to consumers.
C. can increase competition in the marketplace and lower prices.
D. All of these statements are true.
Answer: D
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All industrialized countries have become “service economies.” Which factor helps explain this shift?
A. Trade unionism and failure of the manufacturing sector to grow B. Information age and laborsaving innovation in manufacturing C. The decline in the number of workers possessing the required skills for industrial production D. The lack of competition in the service sector
Comment on the following statement: "Even though the supply of land is perfectly inelastic, the supply of land in a given use may not be fixed."
What will be an ideal response?
Using the information in the table, develop the four-firm concentration ratio. Would you classify this industry as an oligopoly? Explain your answer
What will be an ideal response?
Mrs. Smith is operating a firm in a competitive market. The market price is $6.50 . At her profit-maximizing level of output, her average total cost of production is $7.00, and her average variable cost of production is $6.00 . Which of the following statements about Mrs. Smith's firm is correct?
a. Mrs. Smith is earning a loss and should shut down in the short run. b. Mrs. Smith is earning a loss but should continue to operate in the short run. c. Mrs. Smith is earning a profit since the price is above the average variable cost. d. Without knowing Mrs. Smith's marginal cost, we cannot determine whether she should stay in business or shut down.