What is the definition of an oligopoly?
a) one firm producing 95 percent of the output
b) two to four firms producing 70 percent to 80 percent of the output
c) eight to ten firms producing 60 percent to 70 percent of the output
d) eight to ten firms producing 90 percent of the output
Ans: b) two to four firms producing 70 percent to 80 percent of the output
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Which of the following is correct when the perfectly competitive firm is producing its long-run equilibrium output level?
a. MR equals MC. b. AR equals ATC. c. P equals MC. d. All of these.
If all firms in perfect competition have the same average revenue and pay the same price for inputs such as labor and materials, why do they not all have the same profit?
What will be an ideal response?
Suppose that the market for coffee is in equilibrium at a price of $9.50 per pound and a monthly quantity of 20 million pounds. News of a drought in Brazil arrives so that people know that the supply of coffee months from now will be sharply reduced
What, if anything, will happen in the coffee market now? Explain.
Unemployment that has an entirely macroeconomic cause is called
a. frictional unemployment b. seasonal unemployment c. structural unemployment d. cyclical unemployment e. short-term unemployment