When a firm creates an industry,
A. it is there forever. No other firm can enter.
B. the firm's economic profit will stabilize.
C. depending on the ease of entry, the firm's economic profit is likely to diminish.
D. the firm's economic profit will rise because other firms will enter.
Answer: C
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Evaluate the following statement. "The nation of Berundi has an absolute disadvantage in the production of everything compared to the United States. Therefore, the United States will have no reason to trade with Berundi"
What will be an ideal response?
The real business cycle theory is most closely related to
a. Keynesian theory. b. monetarist theory. c. the classical model. d. the new Keynesian model.
Cyclical unemployment is caused by
A) technological change. B) fluctuations in the business cycle. C) a dynamic economy in which people want to switch jobs sometimes. D) predictable shifts in production associated with different seasons.
A monopoly will maximize profits at the level of output at which
A) MR = MC. B) MR = AFC. C) MC = ATC. D) MC = P.