The main difference between perfect competition and monopolistic competition is:
a. The number of sellers in the market
b. The ease of entry and exit in the industry
c. The degree of information about market price
d. The degree of product differentiation
e. Whether it is the short run or the long run
d
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Which of the following is true of government activities under a system of representative democracy?
a. When voters pay in proportion to benefits received, all voters will gain if the government activity is productive. b. If a majority opposes an activity, it must be counterproductive. c. When voters must pay in proportion to benefits received for an activity undertaken by the government, the activity will most likely be rejected by the majority of voters. d. Government activities must be productive in order to be eligible for vote.
In the long run, firms in a perfectly competitive market produce:
A. at a quantity with positive economic profits. B. where average variable costs are minimized. C. where MC is at its lowest point. D. where price equals marginal cost.
Hold the prices of goods, as well as Amy's preferences, constant. If Amy's income increases, then
a. both her indifference curves and budget constraint change. b. her indifference curves change, but her budget constraint does not change. c. her budget constraint changes, but her indifference curves do not change. d. neither her indifference curves nor her budget constraint change.
As people buy more and more of a service, their consumer surplus
A. increases. B. decreases. C. falls to zero. D. becomes negative.