A monopolistic competitive firm is inefficient because the firm:
a. earns positive economic profit in the long run.
b. is producing at an output corresponding to the condition that marginal cost equals price.
c. is not maximizing its profit.
d. produces an output where average total cost is not minimum.
d
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Assume the demand for sugar decreases and the supply of sugar increases. Which of the following outcomes is certain to occur?
A. The equilibrium quantity of sugar will rise. B. The equilibrium price of sugar will rise. C. The equilibrium quantity of sugar will fall. D. The equilibrium price of sugar will fall.
When policy makers take actions in response to or in anticipation of some change in the overall economy, there is
A) passive policy making. B) rationalization policy making. C) rational expectations policy making. D) active policy making.
Refer to Scenario 25-2. As a result of Kristy's deposit, Bank A's excess reserves increase by
A) $2,000. B) $8,000. C) $10,000. D) $50,000.
The managerial technique of markup pricing is consistent with the economic theory of profit maximization when the markup is positively related to the price elasticity of demand
Indicate whether the statement is true or false