What is the relationship between start-up costs and a competitive market?
(A) There is no consistent relationship between start-up costs and the competitiveness of a market.
(B) Low start-up costs are likely to make a market less competitive.
(C) Markets with high start-up costs are more likely to be perfectly competitive.
(D) Markets with high start-up costs are less likely to be perfectly competitive.
Ans: (D) Markets with high start-up costs are less likely to be perfectly competitive.
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Economists criticize monopolies because monopolies
A) always price discriminate. B) receive accounting profits. C) restrict output and raise prices compared to a competitive situation. D) make consumers pay more for their product than the customers value the product.
The quantity demanded of good X falls by 20% and, in response, your income goes down by 10% and, the income elasticity of demand would be:
a. 2 b. 4 c. .5 d. .20
The motive for the erecting trade barriers to import goods and services from abroad is to
A. improve economic efficiency in that nation. B. protect and benefit special interest groups in that nation. C. reduce the prices of the goods and services produced in that nation. D. expand the export of goods and services to foreign nations.
Refer to the information provided in Figure 6.5 below to answer the question(s) that follow.
Figure 6.5Refer to Figure 6.5. Molly's budget constraint is EF. If her income decreases and the price of CDs increases, her new budget constraint could be
A. CD. B. BD. C. AD. D. Both B and C are correct.