Competitive firms cannot individually affect market price because:
A.) There is an infinite demand for their goods.
B.) The market demand curve is flat or horizontal.
C.) Their individual production is insignificant relative to the production of the industry.
D.) The government exercises control over the market power of competitive firms.
C.) Their individual production is insignificant relative to the production of the industry.
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Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary B. B; no output C. B; expansionary D. A; a recessionary
A market is classified as monopolistically competitive when
A) there is a barrier that blocks entry by other firms. B) a small number of firms compete. C) many firms produce the same product. D) many firms produce a slightly differentiated product. E) there is one firm that sells a good or service with no close substitutes.
Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. Suppose Country B decides to specialize in tomatoes, and Country A specializes in bananas. What terms of trade would both countries agree to? One tomato for:
A. four bananas B. six bananas C. one banana D. two bananas
Compared to the 1950-1973 period, output per worker ________ in the 1974-1995 period.
A. increased more rapidly B. decreased more slowly C. increased more slowly D. decreased more rapidly