Monopolistic competition is similar to monopoly in that:
a. firms face perfectly elastic demand curves
b. firms sell products for which there are no close substitutes.
c. there is relatively free entry and exit.
d. firms have some influence over the product price.
d
You might also like to view...
The short-run aggregate supply curve shifts when
I. the full-employment quantity of capital changes. II. technology advances. A) I only B) II only C) neither I nor II D) I and II
Inflation
A. increases the real value of the debt. B. has no impact on the debt. C. decreases the real value of the debt. D. is always factored into any calculations of deficits or surpluses.
The marginal propensity to consume is:
A. the change in consumer spending minus the change in aggregate disposable income. B. the change in consumer spending divided by the change in aggregate disposable income. C. the proportion of total disposable income that the average family consumes. D. increasing if the marginal propensity to save is increasing.
Suppose that the government increases expenditures by $150 billion while increasing taxes by $150 billion. Suppose that the MPC is .80 and that there are no crowding out or accelerator effects. What is the combined effects of these changes? Why is the combined change not equal to zero?