Which of the following best describes the idea of excess capacity in monopolistic competition?
a. Firms produce more output than is socially desirable.
b. The output produced by a typical firm is less than what would occur at the minimum point on its ATC curve.
c. Due to product differentiation, firms choose output levels where price equals average total cost.
d. Firms keep some surplus output on hand in case there is a shift in the demand for their product.
b
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Monica consumes only goods A and B
Suppose that her marginal utility from consuming good A is equal to 1/Qa, and her marginal utility from consuming good B is 1/Qb. If the price of A is $0.50, the price of B is $4.00, and the Monica's income is $120.00, how much of good A will she purchase? A) 0 B) 12 C) 24 D) 48 E) 120
In the year 2010, the richest fifth of the American population earned close to:
a. 50% of the total income. b. 20% of the total income. c. 30% of the total income. d. 80% of the total income.
A trough in the business cycle:
a. The natural rate of unemployment is at a minimum point b. Structural and frictional unemployment are at their highest levels c. Employment and output reach their lowest levels d. Cyclical unemployment is at a minimum point
Product differentiation always exists in
A. oligopoly. B. monopolistic competition. C. perfect competition. D. monopoly.