A market where a few firms produce most of the output is called a(n)
A. oligopolistic market.
B. monopolistic market.
C. monopolistically competitive market.
D. perfectly competitive market.
Answer: A
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Suppose that good X is on the horizontal axis and all other goods (measured in dollars) are on the vertical axis in the consumer-choice diagram. If the consumer gains $10 in income, then
a. the new budget line is parallel to and lies 10 units to the left of the old budget line. b. the budget line shifts up by 10 dollars, with no change in the slope. c. the vertical intercept of the budget line shifts up by $10, but the horizontal intercept remains unchanged. d. the slope of the budget line increases by 10 percent.
If a consumer's budget line between meat and potatoes has a vertical axis intercept at 100 pounds of meat and a horizontal axis intercept at 100 pounds of potatoes
a. demand must be inelastic b. the consumer's budget must equal $100 c. both meat and potatoes must be priced at $1 per pound d. the price of a pound of meat must equal the price of a pound of potatoes e. the opportunity cost of meat in terms of potatoes cannot be determined
If a corporation borrows capital for a specified period of time at an agreed-upon interest rate, this is a
a. common stock b. preferred stock c. convertible stock d. bond e. double tax
Competition is present when
A) subsidies assure that inefficient firms remain active in the market. B) there is little incentive to introduce new products and discover better ways of doing things. C) the market is characterized by rising prices and declining product quality. D) freedom of entry and rival firms are present in a market.