The smaller U.S. mainframe computer and peripheral equipment manufacturers of the 1960s (the "Bunch") were perfect competitors, since they produced homogenous products and had little control over the market price
Indicate whether the statement is true or false
F
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Which of the following is a valid characteristic of the U.S. economy over the last sixty years?
A) Investment is smoother than most of the other components of GDP, especially consumption. B) Government spending has remained around 20% of GDP over much of the postwar period. C) The U.S. has, for the most part, been running a trade surplus which has trended upward to over 5% of GDP. D) all of the above E) none of the above
Why do negative externalities like pollution result in inefficiency?
A. Because producers artificially restrict their supply. B. Because producers ignore the external costs they impose on third-parties. C. Because producers manufacture more goods than people can afford to buy. D. Because producers will receive an unequal distribution of profits.
If the price elasticity of supply is equal to zero and the price was to rise, the quantity supplied would:
A. decrease slightly. B. fall to zero. C. not change. D. increase.
In a competitive market, economic profits will
A. Cause new firms to leave the market. B. Cause existing firms to expand production. C. Potentially last a long time. D. Not be possible, even in the short run.