A monopolistically competitive firm earning profits in the short run will find the demand for its product decreasing and becoming more elastic in the long run as new firms move into the industry until
A) the original firm is driven into bankruptcy.
B) the firm's demand curve is perfectly elastic.
C) the firm exits the market.
D) the firm's demand curve is tangent to its average total cost curve.
D
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The simplified spending multiplier is calculated as:
A. ?MPC/(1 ? MPC). B. (1 ? MPC) × ?MPC. C. 1/(1 ? MPC). D. ?1/(1 ? MPC).
Which of the following produces a movement along the aggregate demand curve and does not shift the aggregate demand curve?
A) a change in government expenditures on goods and services B) a change in monetary policy C) a change in the price level D) a change in foreign incomes E) a change in expectations about the future
Trinh quits his $80,000-a-year job to become a full-time volunteer at a museum. What is the opportunity cost of his decision?
A) the value he attributes to the joy of working at a museum B) depends on the "going rate" of museum employees C) at least $80,000 D) 0 since he will no longer be earning a salary
U.S. opponents of NAFTA argued that the agreement will hurt the United States. In their view, NAFTA's greatest harm will be its
A) harmonization of labor policies. B) harmonization of environmental policies. C) harmonization of the use of pesticides and herbicides. D) job destruction and downward pressure on U.S. wages. E) harmonization of product safety standards.