When firms enter a market, the supply increases and price:
A. increases and profits decrease.
B. falls and profits increase.
C. falls and profits decrease.
D. increases and profits increase.
C. falls and profits decrease.
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Mark can make 3 tables and 1 chair in a day while John can make 4 tables and 1 chair in a day. Which of the following is true?
A) Mark has a comparative advantage in making tables. B) Mark has an absolute advantage in making tables. C) John has an absolute advantage in making tables. D) John has a comparative advantage in making chairs.
In the above figure, at point b what is the opportunity cost of producing 2 more audio tapes?
A) 1/2 video tape per audio tape B) 1 video tape per audio tape C) 6 video tapes per audio tape D) There is no opportunity cost.
A subsidy is defined as
a. a payment that must be made to the government whenever a good or service is sold. b. the number of trades that are eliminated from a market when a tax is imposed. c. the difference between total revenue and total cost for a business firm. d. a payment to either the buyer or seller of a good or service, usually on a per-unit basis, when a good or service is purchased.
People differ on the method by which stock should be valued. Some people are chartists, others behavioralists. The basic difference between these groups is:
A. chartists study charts of stock prices; behavioralists focus on investor psychology and behavior. B. chartists rely on astrological charts to predict stock values, behavioralists rely on psychology. C. behavioralists are finance based, chartists study charts of investor psychology. D. chartists and behavioralists are the same in their approach; essentially there aren't any differences.