A monopolistically competitive firm produces where
A. marginal revenue equals price.
B. marginal revenue equals marginal cost.
C. its marginal revenue curve lies above its demand curve.
D. its marginal revenue curve intersects the quantity axis.
Answer: B
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A relatively flat LM curve implies that wide fluctuations in the goods sector cause
A) wide fluctuations in real output. B) wide fluctuations in the price level. C) wide fluctuations in the interest rate. D) crowding out of private investment.
The above figure shows the market for a particular good. If the market is controlled by a perfect-price-discriminating monopoly, compared to a perfectly competitive market, the change in consumer surplus is
A) A. B) A + B + C. C) A + B + C + D + E. D) zero.
What are the net costs of tariffs and quotas on consumption and income distribution?
What will be an ideal response?
A price ceiling is typically imposed on a market because of ___________ and it creates _______
a. a chronic excess demand; an unacceptable price increase b. an unacceptable price increase; chronic excess demand c. an unacceptable price decrease; chronic excess demand d. an unacceptable price decrease; chronic excess supply e. an unacceptable price increase; chronic excess supply