A market structure characterized by a very few firms who behave interdependently is known as:
a. monopoly.
b. monopolistic competition.
c. natural monopoly.
d. oligopoly.
d
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An increase in real interest rates will increase aggregate demand.
Answer the following statement true (T) or false (F)
If the marginal benefit of reducing water pollution is constant at $10 per ton, then it is efficient to reduce water pollution:
A. to zero. B. until the marginal cost of reducing water pollution equals $10 per ton. C. as long as the marginal cost of reducing water pollution is greater than $10 per ton. D. to whatever level the market determines.
The closer the substitutes for a good, the
A) more elastic is the demand for the good. B) less elastic is the demand for the good. C) smaller the degree of substitutability between the goods. D) larger the proportion of income that is spent on the good.
Perfect competition is efficient because all the following conditions hold except ________
A. total product is maximized B. firms maximize profit and produce on their supply curves C. consumers get a real bargain and pay a price below the value of the good D. firms minimize their average total cost of producing the good