Economies of scale act as a barrier to entry because
a. one large firm can supply the market at a higher average cost than many small firms could
b. firms are not allowed by law to sell output below average cost
c. large firms can hire inputs at a higher price than smaller firms could
d. firms will not compete with a larger firm when there are differences in marginal cost
e. one large firm can produce the market output at a lower average cost than many small firms
E
You might also like to view...
A price floor set above the equilibrium price
A) creates a surplus. B) creates a shortage. C) creates excess demand. D) balances supply and demand. E) has no effect.
Gains from trade can be realized if each country specializes in the production of a good in which it has a comparative advantage
a. True b. False Indicate whether the statement is true or false
Which of the following explains why economists may disagree over normative issues?
a. They have different beliefs and values. b. They examine the same data to draw their conclusions. c. They need to disagree in order to publish their research findings. d. They often employ different statistical techniques when examining data. e. Some work only on microeconomic issues, while others focus exclusively on macroeconomic issues.
If the MPC = 0.8, and intended investment rises from $100 to $150, national income will increase by
a. $50 b. $125 c. $20 d. $250 e. $200