The variety of products and product features that consumers may choose from in monopolistically competitive industries:
A. at least partially offsets the economic inefficiencies of this market structure.
B. leads to an optimal allocation of resources in the market structure.
C. makes the demand curves facing firms in these industries more elastic.
D. guarantees that firms produce at full-capacity output levels.
Answer: A
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State colleges are an example of
A) income maintenance programs. B) Social Security. C) welfare programs. D) subsidized services.
You are an analyst with a perfectly competitive firm that makes DRAM memory chips. You must manufacture the chips before you know what the demand will be. Based on the below figure, if the demand is high with an 80% probability and low with a 20% probability, the expected marginal revenue for a chip is ________.
A) $2.00
B) $2.60
C) $2.40
D) $1.40
If the economy in the graph shown were at point B, and the government wished to bring the economy back to its long-run equilibrium, it might:
A. increase government spending.
B. increase income tax.
C. decrease tax credits.
D. All of these would move the economy to its potential GDP from point B.
In a command economy, the basic economic questions are answered by:
a. central authority. b. None of the answers are correct. c. individual buyers and sellers. d. the traditional methods.