In the 1920s and 1930s, economists became increasingly aware that there were industries that did not fit the model of perfect competition or pure monopoly. Two separate theories of monopolistic competition resulted. Edward Chamberlin of Harvard published
the Theory of Monopolistic Competition in 1933. Chamberlin defined monopolistic competition as
A) a relatively large number of producers offering similar but differentiated products.
B) a relatively small number of producers offering similar but differentiated products.
C) a market situation in which a large number of firms produce identical products.
D) a market situation in which a small number of firms produce similar products.
Answer: A
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Economic progress is best measured by
A. the growth rate of prices over time. B. the growth rate of GDP per capita. C. the amount of working time needed for an individual worker to afford certain goods and services. D. the annual growth rate in the population.
If an individual has a 0.3 probability of receiving $10 and a 0.7 probability of receiving $20, the expected income is
A) $20. B) $7. C) $14. D) $17.
Which of the following statements exemplifies a principle of individual decisionmaking?
a. Trade can make everyone better off. b. Governments can sometimes improve market outcomes. c. The cost of something is what you give up to get it. d. All of the above are correct.
Assuming well-defined indifference curves, when marginal utility is zero, total utility is at a maximum.
Answer the following statement true (T) or false (F)