In monopolistic competition, a firm
A. Has a standardized product that all firms produce.
B. Has no market power.
C. Captures significant economies of scale.
D. Has a downward-sloping demand curve.
Answer: D
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If the Federal Reserve conducts open market sales, the money supply ________, shifting the LM curve to the ________, everything else held constant
A) decreases; right B) decreases; left C) increases; right D) increases; left
In terms of the impact on aggregate expenditure of alternative methods of raising additional revenue for government spending,
a. borrowing from banks is more effective than taxation, which is more effective than borrowing from the public. b. taxation is more effective than borrowing from the public, which is more effective than borrowing from banks. c. borrowing from banks is more effective than borrowing from the public, which is more effective than taxation. d. borrowing from the public is more effective than borrowing from the banks, which is more effective than taxation.
Which of the following statements is true?
a. The elasticity of demand for a product cannot change over time. b. Elasticity is useful in theory but cannot be measured in real life. c. The elasticity of demand will be larger if there are good substitutes available. d. If I can't live without the product, my demand will be elastic. e. none of these are true
When a market is corrected for externalities, it:
A. makes everyone in society better off. B. is equitable. C. maximizes surplus. D. All of these statements are true.