Suppose a ten firm industry has total sales of $35 million per year. The largest firm has sales of $10 million, the third largest firm has sales of $4 million, and the fourth largest firm has sales of $2 million. If the rest of the industry has annual sales of $12 million, the second largest firm has sales of
A. $7 million.
B. $4 million.
C. $8 million.
D. none of these.
Answer: A
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When firms exit a monopolistically competitive industry: a. the average total cost curves of remaining firms will shift upward
b. the demand curves of remaining firms are decreased at each level of output. c. the remaining firms will decrease production. d. the average revenue received by remaining firms will increase at each level of output.
The own price elasticity of demand for apples is ?1.2. If the price of apples falls by 5 percent, what will happen to the quantity of apples demanded?
A. It will increase 6 percent. B. It will fall 4.3 percent. C. It will increase 5 percent. D. It will increase 4.2 percent.
We assume that when a firm hires additional workers, the marginal physical product of labor will
A) increase because more workers can always get more work done. B) decrease because the new workers are likely to be less able than the previously hired ones. C) decrease because each worker now has less capital and other resources to work with. D) increase because large firms are more efficient.
Refer to Table 9-11. Which country has a comparative advantage in producing clocks?
A) Belize B) Denmark C) both countries D) neither country