Equilibrium price
What will be an ideal response?
The price that balances quantity supplied and quantity demanded.
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Overexpansion can cause a perfectly competitive firm to ________.
A) produce at a quantity where the market price exceeds the firm's average total cost B) produce at a quantity where the marginal revenue exceeds the firm's average total cost C) earn economic profit D) produce at a quantity where the average total cost exceeds the firm's marginal revenue
Which of these contributes to the existence of monopoly power?
a. the control of critical resources b. legal barriers c. patents d. All of the above contribute to the existence of monopoly power.
When road construction crews work at less than 100 percent of effort during their work days in order to create overtime work for themselves, they are creating what economists describe as a
a. moral hazard problem b. work dependency problem c. principal-agent problem d. efficiency wage problem e. employment-management problem
The gains from trade are
a. evident in economic models, but seldom observed in the real world. b. evident in the real world, but impossible to capture in economic models. c. a result of more efficient resource allocation than would be observed in the absence of trade. d. based on the principle of absolute advantage.