Which of the following arguments could be made as evidence that the market for cage-free eggs is perfectly competitive?
A) The U.S. Department of Agriculture has established standards for the labeling of cage-free eggs.
B) Sales of cage-free eggs have increased at a rate of 20 percent per year.
C) As more farmers began selling cage-free eggs, the increase in supply has driven down prices to the point where they just cover the cost of production.
D) The profits earned by farmers who sell cage-free eggs have continued to grow, despite the increasing number of farmers entering this market.
Answer: C
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A radio station is best described as
A) an end user in a transaction-based market. B) a platform in an audience-making market. C) an end user in a matchmaking market. D) a platform in a shared-input market.
Which of the following does purchasing-power parity imply?
a. the foreign price level times the nominal exchange rate (given as amount of foreign currency per dollar) equals the U.S. price level. b. The price of domestic goods relative to foreign goods cannot change. c. The nominal exchange rate is the ratio of foreign prices to U.S. prices. d. All of the above are correct.
The real wages of workers will tend to be high when
a. industries are automating at a slow rate. b. output per worker is high. c. capital is scarce. d. profits are low.
Refer to the graph below. At equilibrium, the total amount of spending that consumers would be paying for the product is represented by the area:
The equilibrium point in the market is where S and D curve intersect.
A. a + b
B. a + b + c
C. a
D. b + c