When oligopolies operate like firms in perfect competition, the firms produce at the point where the
A) price is less than the marginal cost.
B) marginal cost equals the price.
C) price exceeds the marginal cost by the greatest amount.
D) price exceeds the average total cost by the greatest amount.
E) marginal cost equals the average total cost.
B
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An increase in demand:
A. results in a leftward shift of the demand curve. B. could be caused by a decrease in the price of the good. C. could be caused by an increase in the price of a substitute good. D. is shown as movement down along a demand curve.
In the long run, price elasticities of demand are usually
A. greater than they are in the short run because consumers have time to adjust. B. the same as they are in the short run because tastes don't change. C. less than they are in the short run because prices rise over time. D. less than they are in the short run because real prices fall over time.
An increase in the price of input used to produce a product will lead to
A) a decrease in the demand for that product. B) a decrease in quantity supplied of that product C) a decrease in the supply of that product. D) an increase in the supply of that product.
If the tax multiplier is -5.25, then the government purchases multiplier
A. is 6.25. B. is 4.75. C. is 0.75. D. cannot be determined because the MPS is not given.