When new firms enter a competitive price-taker market,
a. economic profits of existing firms will continue to be zero.
b. entering firms will earn zero economic profit upon entry into the market.
c. existing firms may see their costs rise as more firms compete for limited resources.
d. prices will rise as existing firms raise prices to keep new firms out of the market.
C
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Other things the same, if the Fed increases the quantity of money, the supply of money curve shifts
A) rightward and the nominal interest rate decreases. B) leftward and the real interest rate increases. C) leftward and the nominal interest rate increases. D) leftward and the nominal interest rate decreases. E) rightward and the real interest rate increases.
Currency traders expect the dollar to depreciate. What impact will this have on equilibrium in the foreign exchange market?
A) The dollar will appreciate, and the equilibrium quantity of dollars will increase. B) The dollar will depreciate, and the equilibrium quantity of dollars exchanged will decrease. C) The dollar will appreciate, and the equilibrium quantity of dollars will decrease. D) The dollar will depreciate, and the change in the equilibrium quantity of dollars exchanged cannot be determined.
The concept that explains firms possessing different bundles of resources is
a. Resource heterogeneity b. Resource immobility c. Barriers to entry d. imitability
A country that has relatively large amounts of a particular resource at its disposal
a. will tend to have an absolute advantage b. will trade the resource for some good in which that country has an absolute advantage c. will tend to have a comparative advantage in goods that make heavy use of that resource d. will trade the resource for some good in which that country has a comparative advantage e. will tend to have a low exchange rate