A monopolistically competitive firm earning profits in the short run will find the demand for its product decreasing and becoming more elastic in the long run as new firms move into the industry until
A) the original firm is driven into bankruptcy.
B) the firm's demand curve is perfectly elastic.
C) the firm's demand curve is tangent to its average total cost curve.
D) the firm exits the market.
Answer: C
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The marginal product of labor is the
A) change in total product produced by hiring an additional unit of labor. B) total revenue divided by units of labor. C) extra revenue gained by selling one more unit of output produced by hiring additional units of labor. D) extra revenue gained by employing one more unit of labor.
Restaurants cluster together. That is, on one corner, there may be four similar fast-food restaurants. How can this be explained using a location game theory model?
What will be an ideal response?
If a firm is a price taker, then the demand curve faced by the firm is perfectly elastic
a. True b. False Indicate whether the statement is true or false
In long-term job attachments, a worker's wage:
a. always exceeds his productivity. b. always falls below his productivity. c. is lower than his productivity at the beginning, then equals it, and then exceeds the same. d. is higher than his productivity at the beginning, then equals it, and then falls below the same.