When does a monopolistic competitor earn positive economic profits in the short run?
What will be an ideal response?
A monopolistic competitor earns positive economic profits in the short run if the short-run equilibrium price is higher than the average total cost of production.
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A tariff has one distinct advantage over a quota. It increases tax revenues to the government.
Answer the following statement true (T) or false (F)
Which of the monetary policy tools can alter both the level of excess reserves and the money multiplier?
A. The reserve requirement B. The discount rate C. Open-market operations D. The federal funds rate
The correct expression for cost plus pricing is
A) Price = Cost (1 + profit margin). B) Price = Cost + profit margin. C) Price = Cost (1 + mark-up). D) Price = Cost + (1 + mark-up).
If corporations have their choice, they will prefer to invest using
A. revenue from the sale of stocks. B. revenue from the sale of bonds. C. plowback. D. money borrowed from the bank.