Which of the following is not a characteristic of a perfectly competitive market?
a. Sellers set the price of the product.
b. There are many sellers.
c. Buyers must accept the price the market determines.
d. All of the above are characteristics of a perfectly competitive market.
a
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If the Central Bank of Macroland puts an additional 1,000 dollars of currency into the economy, the public deposits all currency into the banking system, and banks have a desired reserve/deposit ratio of 0.20, then the banks will eventually make new loans totaling ________ and the money supply will increase by ________.
A. $1,000; $5,000 B. $1,000; $1,000 C. $4,000; $4,000 D. $4,000; $5,000
If the monetary policy curve is correct, then policy makers care only about inflation and not at all about aggregate output and unemployment. Comment
What will be an ideal response?
Many economists think that, in the long run, the Phillips curve is
A. a horizontal line. B. a vertical line. C. the same as the short-run curve. D. a 45-degree line from the origin.
The price setting equation is represented by the following: P = (1 + m)W. When there is perfect competition, we know that m will equal
A) W. B) P. C) 1. D) W/P. E) none of the above