If economic profits are earned in a competitive market, then over time
A. Normal profit will fall to zero as more firms enter.
B. The market supply curve will shift to the left.
C. Equilibrium price will rise as more firms enter.
D. Additional firms will enter the market.
Answer: D
You might also like to view...
Refer to the Article Summary. Unlike in the UK, labor productivity in the other G7 nations has increased since 2007. An increase in labor productivity:
A) will increase the labor force participation rate. B) allows the average consumer to increase consumption. C) will create short-run, but not long-run, economic growth. D) will increase output and decrease wages in the long-run
Two products are substitutes if:
A. an increase in the price of one causes buyers to demand less of the other. B. an increase in the price of one causes buyers to demand more of the other. C. a decrease in the price of one causes buyers to demand more of the other. D. individuals consume the goods together.
Suppose Island Bikes, a profit-maximizing firm, is the only bike rental company in a small resort town. The marginal cost to Island Bikes of renting out a bike is $3, and Island Bikes has no fixed costs. Each day Island Bikes has six potential customers, whose reservations prices are listed in the table. CustomerReservation Price($/Rental)A22B16C12D8E6F4Suppose Island Bikes knows that customers whose reservation prices are at least $10 always rent bikes before noon, while those whose reservation prices are below $10 never do so. If Island bikes can charge a different price in the morning and in the afternoon, then in the afternoon, it will rent out ________ bike(s) and charge ________ per bike.
A. 3; $4 B. 5; $10 C. 1; $8 D. 2; $6
The Beck Depression Inventory-II has a reliability coefficient (coefficient alpha) of .92. Using classical test theory, interpret the meaning of this reliability coefficient.
a. The amount of error variance to observed variance is 92%
b. The amount of true variance to observed variance is 92%
c. The instrument has good enough reliability
d. The instrument's validity coefficient would be .922 (or .92 squared)