As new firms enter a monopolistically competitive industry, the ________ curve facing each existing firm will shift to the left and become more elastic because there are now ________ substitutes for its product.
A. supply; more
B. supply; less
C. demand; more
D. demand; less
Answer: C
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The interest-rate-based transmission mechanism for monetary policy in the Keynesian system indicates that
A) decreases in the money supply lead to increases in the interest rate, which increases investment, which increases the level of real GDP. B) increases in the money supply cause people to spend more, leading to increases in real GDP. C) increases in the money supply lead to decreases in the interest rate, which decreases investment, which decreases the level of real GDP. D) increases in the money supply lead to decreases in the interest rate, which increases investment, which increases the level of real GDP.
Which of the following shifts the demand curve for oranges?
A) disastrous weather that destroys about half of this year's orange crop B) a decrease in the price of a pound of bananas, a substitute in consumption for oranges C) an increase in the price of the fuel used to transport oranges to supermarkets D) great weather that produces a bumper orange crop this year
The greater the availability of close substitutes for a product, the greater the price elasticity of demand for that product
a. True b. False
Given the data provided in the table below, what will the marginal cost equal for production at quantity (Q) level 4?
a. $4.00
b. $5.00
c. $3.00
d. $1.00