"In a long-run equilibrium, price is equal to average total cost." This statement applies to
a. competitive markets, but not to monopolistically competitive markets or monopolies.
b. competitive and monopolistically competitive markets, but not to monopolies.
c. competitive markets, monopolistically competitive markets, and monopolies.
d. None of the above is correct.
b
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A system for studying strategic behavior in economics is called
a. decision science. b. political economy. c. game theory. d. solution concepts.
Income taxes create a wedge between the wage rate paid by ________ and received by workers and thereby ________ employment and ________ potential GDP
A) firms; raise; decrease B) households; lower; decrease C) firms; lower; decrease D) firms; lower; increase E) firms; raise; increase
Which of the following helps explain why depositors sometimes put their funds in demand deposits rather than NOW accounts?
A) Demand deposits pay interest, whereas NOW accounts do not pay interest. B) Businesses may not hold NOW accounts. C) Checks may be written against demand deposits, but not against NOW accounts. D) Demand deposits are more liquid than NOW accounts.
We call costs that fall directly on an economic decision maker:
A. social costs. B. external costs. C. network costs. D. private costs.