Why do most firms in monopolistic competition typically make zero profit in the long run?
A) because the lack of entry barriers would compete away profits
B) because the total market is not large enough to accommodate so many firms
C) because firms do not produce at their minimum efficient scale
D) because firms produce differentiated products
A
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A game show host who gave up his job as a teacher brags about his salary, saying "the rest is pure gravy." Here, "the rest" refers to
a. opportunity cost b. implicit cost c. explicit cost d. the height of his labor supply curve e. economic rent
How can the government cut the cost of negotiation among car owners regarding LoJack installation?
a. The government can impose a quota on the import of LoJacks. b. The government can invite public opinion on LoJacks. c. The government can limit the number of companies producing LoJacks. d. The government can randomly select cars to install LoJacks.
If an economy is fully utilizing its resources, it can produce more of one product only if it:
A. doubles manufacturing of the product. B. produces less of another product. C. adds more people to the labor force. D. reduces the prices of the most expensive products.
In order to pay for services such as health care, education, and highways, governments
A) collect taxes B) sell tools and machinery to the business sector C) rely fully on donations from the population