In monopolistic competition, barriers to entry give the firms the power to set their price
Indicate whether the statement is true or false
FALSE
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If interest rates increase from 9 percent to 10 percent, a bank with a duration gap of 2 years would experience a decrease in its net worth of
A) 0.9 percent of its assets. B) 0.9 percent of its liabilities. C) 1.8 percent of its liabilities. D) 1.8 percent of its assets.
Provide two circumstances where monopoly may offer efficiency advantages over competition
Which of the following sequences would cause E1 to shift to E2?
a. P1 decreases to P2; D1 decreases to D2; Q1 decreases to Q2
b. P1 decreases to P2; Q1 decreases to Q2; D1 decreases to D2
c. D1 decreases to D2; P1 decreases to P2; Q1 decreases to Q2
d. Q1 decreases to Q2; D1 decreases to D2; P1 decreases to P2
Accounting costs and economic costs differ because
A. Accounting costs include explicit costs, and economic costs do not. B. Accounting costs exceed economic costs whenever any factor is not paid an explicit wage. C. Accounting costs include implicit costs, and economic costs do not. D. Economic costs include the opportunity costs of all resources used, while accounting costs include actual dollar outlays.