Why do most firms in monopolistic competition typically make zero profit in the long run?
A) because firms produce differentiated products
B) because the lack of entry barriers would compete away profits
C) because firms do not produce at their minimum efficient scale
D) because the total market is not large enough to accommodate so many firms
Answer: B
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The term stagflation refers to:
a. a simultaneous reduction in output and the price level b. a simultaneous increase in output and the price level. c. a decline in the price level accompanied by increases in real output and employment. d. an increase in the price level accompanied by decreases in real output and employment. e. a simultaneous increase in both the trade deficit and the budget deficit.
As you move down a demand curve, if a decrease in price from $11 to $9 increased total revenue, then further decreases below $9 would also increase total revenue
a. True b. False Indicate whether the statement is true or false
Suppose Ireland exports beer to China and imports pineapples from the United States. This situation suggests that
a. Ireland has a comparative advantage relative to the United States in producing pineapples, and China has a comparative advantage relative to Ireland in producing beer. b. Ireland has a comparative advantage relative to China in producing beer, and the United States has a comparative advantage relative to Ireland in producing pineapples. c. Ireland has an absolute advantage relative to the United States in producing pineapples, and China has an absolute advantage relative to Ireland in producing beer. d. Ireland has an absolute advantage relative to China in producing beer, and the United States has an absolute advantage relative to Ireland in producing pineapples.
Figure 12.8 depicts an advertising game between two stores. "Advertising" is:
A. a dominant strategy for Store A but not for Store B. B. a dominant strategy for Store B but not for Store A. C. a dominant strategy for both stores. D. a dominant strategy for neither store.