Perfectly competitive firms are earning economic profits at a market price of $12 and an average total cost of $10. If new firms enter and do not affect the cost for all firms, the market price will ________ until it reaches ________.
A) increase; $16 B) decrease; $10 C) decrease; $11 D) increase; $13
B) decrease; $10
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The precautionary motive for holding money reflects the behavior of people who hold money
a. instead of near money b. to transact purchases they expect to make c. as insurance against unexpected needs d. to speculate in the stock market e. to take advantage of anticipated or hoped for changes in interest rates
If firms in an oligopoly market choose to not cooperate with each other, they end up earning higher profits for all
a. True b. False Indicate whether the statement is true or false
Impure public goods
A. are nonrival in consumption. B. cannot be priced in the market. C. are rival in consumption. D. are never provided by the private sector.
In the 2008 presidential election campaign, then-candidate Obama proposed renegotiating NAFTA to provide greater protections for
A. Canadian corporations. B. workers. C. U.S. corporations. D. drug traffickers.