In a given market, a large number of firms sell a similar product. Consumers think that each firm's product is somewhat different from that of its competitors. This market is
A) perfectly competitive.
B) monopolistically competitive.
C) equivalent to a monopoly because consumers think the products are different.
D) equivalent to an oligopoly because consumers think the products are different.
B
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A steady-state equilibrium refers to:
A) an equilibrium in which the stock of physical capital remains constant over time. B) an equilibrium in which the inequality remains constant over time. C) an equilibrium in which the GDP per capita remains constant over time. D) an equilibrium in which the poverty rate remains constant over time.
If the Fed has the discretion to choose its policy and announces a low inflation policy, then
a. the public is likely to discount this claim because the Fed has an incentive to change their policy in the future. b. the public is likely to believe this claim because the Fed has no incentive to change their policy in the future. c. the Fed will always cheat and increase inflation in the future. d. the Fed will have to keep inflation lower in the future or they will be voted out of office. e. none of the above.
If an externality is present in a market, economic efficiency may be enhanced by
a. government intervention. b. a decrease in foreign competition. c. fewer market participants. d. weaker property rights.
Economists use the term inflation to describe a situation in which
a. some prices are rising faster than others. b. the economy's overall price level is rising. c. the economy's overall price level is high, but not necessarily rising. d. the economy's overall output of goods and services is rising faster than the economy's overall price level.