A monopolistic competitor is like a monopolist in that:
a. it sells in the inelastic portion of its demand curve.
b. it earns zero economic profit in the long run
c. the marginal revenue curve lies above the AR curve.
d. it faces a downward-sloping demand curve.
d
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A cartel member has the incentive to cheat on the cartel agreement because
a. it fears that other members may also cheat on the agreement. b. the cartel prevents the member from charging the monopoly price. c. undercutting the cartel price will increase the cartel member's profit. d. the cartel outcome is not Pareto optimal for the cartel members.
Because it has a direct effect on the hiring decisions of firms, a change in business confidence has a much larger impact on the level of economic activity than does a change in consumer confidence
Indicate whether the statement is true or false
If Ron earns $50,000 in salary and pays income taxes of $15,000, and Harry earns $50,000 from investment dividends taxed at 20 percent, this would be
A. vertical inequity. B. horizontal inequity. C. vertical equity. D. horizontal equity.
A productivity increase is illustrated by a shift in the production function
a. downward. b. leftward. c. upward. d. rightward.