What happens to an incumbent firm's demand curve in monopolistic competition as new firms enter?
A) It shifts right.
B) It shifts left.
C) It becomes horizontal.
D) New entrants will not affect an incumbent firm's demand curve.
B
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Assume the current interest rate on a one-year bond is 7%, and the interest rate investors expect on the one-year bond one year from now is 3%
According to the expectations hypothesis, the current interest rate (per year) on a two-year bond should be A) 3%. B) 5%. C) 7%. D) 10%.
Although economists generally favor a negative income tax, there is little political support for it
a. True b. False Indicate whether the statement is true or false
Macroeconomic equilibrium occurs when:
a. Expected supply equals expected demand. b. Actual leakages equal expected injections. c. Actual and expected supply equals actual and depected demand and actual and expected leakages equal actual and expected injections. d. Expected amount supplied equals expected amount demanded, which means expected leakages equal expected injections. e. None of the above.
The primary purpose of antitrust legislation is to:
A. protect small business. B. protect the competitiveness of U.S. business. C. protect the prices of American-made products. D. ensure American labor is paid a fair wage.