In the short run, monopolistically competitive firms behave like ________, but in the long run, the profit of a firm is similar to that of ________.
A. monopolies; oligopolies
B. oligopolies; perfectly competitive firms
C. monopolies; perfectly competitive firms
D. perfectly competitive firms; monopolies
Answer: C
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An oligopoly firm is similar to a monopolistically competitive firm in that
A) both operate in a market in which there are significant entry barriers. B) both firms face the prisoner's dilemma. C) both firms have market power. D) both firms are in industries characterized by interdependence of firms.
A decrease in taxes would shift the:
A) aggregate demand curve rightward. B) aggregate demand curve leftward. C) aggregate supply curve rightward. D) aggregate supply curve leftward.
Which of the following is the best definition of "physical capital"?
a. the labor utilized in the production process b. man-made resources used to produce other goods c. natural resources in their original state d. the ownership of stock shares issued by a corporation
If a Proposer and a Responder are asked to split $100 in the ultimatum bargaining game, standard economic theory would predict that the Proposer should offer the Responder:
A. the smallest dollar amount possible. B. exactly $25. C. exactly $50. D. the largest dollar amount possible.