Consider an unregulated monopoly in Figure 13.2. Suppose that a second firm enters the market. As a result, if the demand curve facing each firm lies entirely below the long-run average cost curve:
A. only one of the two firm can makes a positive economic profit.
B. both the first and the second firm make positive economic profits.
C. neither firm makes a positive economic profit.
D. There is not sufficient information.
Answer: C
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If a fixed money growth rate of 4 percent per year is followed and the growth rate of the natural level of real GDP is 4 percent per year, the average rate of inflation is: a. 8 percent
b. 4 percent. c. zero. d. 1-2 percent.
The Fed conducts an open market sale of Treasury bills of $5 million. If the required reserve ratio is 0.20, what change in the money supply can be expected using the oversimplified money multiplier?
a. $25 million b. $5 million c. 0 d. ?$5 million e. ?$25 million
Hit-It produces 320 baseball bats per day using 2 workers who each work 8 hours per day. What is Hit-It's productivity?
a. 320 baseball bats b. 160 baseball bats per hour c. 20 baseball bats per hour d. None of the above is correct.
Which of the following statements about elasticity measures is true?
A. Elasticities are always positive values. B. Values that are close to zero indicate greater responsiveness. C. Values that are further from zero indicate greater responsiveness. D. Values that are further from zero indicate less elasticity.