Entry of new firms in monopolistically competitive industries can convey a positive externality on consumers because new products result in more consumer surplus. This externality is called the
product-variety externality,
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If the production of a good involves negative externalities, ________
A) the quantity of the good supplied in the market is lower than the efficient level B) the optimal price of the good is higher than the price charged in the market C) total welfare can be increased by increasing the production of the good D) average cost of production can be reduced by increasing output above the optimal level
What can a union do in order to raise the wages of its members?
What will be an ideal response?
Draw a graph showing a short-run average variable cost curve, a short-run average total cost curve, and a short-run marginal cost curve. Briefly explain the shape of each curve and how they relate to each other.
What will be an ideal response?
If Nate takes out a $5,000 loan for one year at 10 percent annual interest, the principal is:
A. $5,000. B. $5,500. C. $500. D. $1000.