The monopolistic competitor produces a ________ output than the perfect competitor, charges a ______ price, and in the long run, earns __________ profit.
Fill in the blank(s) with the appropriate word(s).
smaller; higher; the same (zero economic)
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An increase in the price of plastic raises the cost of manufacturing DVDs. As a result, the market changes to a new equilibrium because of a(n):
a. surplus of DVDs. b. increase in the demand for DVDs. c. leftward shift in the demand curve for DVDs. d. leftward shift in the supply curve for DVDs.
Consider a competitive market with a large number of identical firms. The firms in this market do not use any resources that are available only in limited quantities. In this market, an increase in demand will
a. increase price in the short run but not in the long run. b. increase price in the long run but not in the short run. c. increase price both in the short and the long run. d. not affect price in either the short or the long run.
Does the principle of optimization imply that people always make the best choices?
What will be an ideal response?
As a consumer consumes more and more of a product in a particular time period, eventually marginal utility
A) fluctuates. B) rises. C) is constant. D) declines.