What is "monopolistic" about monopolistic competition?
What will be an ideal response?
Firms sell goods that are close substitutes for each other, but an individual firm's product is unique. Since each version of the product is only sold by one firm, that firm is a monopolist in selling its version of the product.
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Cost-benefit analysis is a tool that is used
A) only by businesses. B) only by individuals and businesses. C) only by governments. D) by individuals, businesses, and governments.
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
Labor-saving technology causes which of the following? (i) The marginal productivity of labor increases. (ii) The marginal productivity of labor decreases. (iii) Labor demand shifts to the right. (iv) Labor demand shifts to the left
a. (i) only b. (ii) only c. (i) and (iii) only d. (ii) and (iv) only
During a period of expansionary monetary policy
A. the price level is decreased, which leads to a decrease in the money supply. B. the price level is increased, which leads to an increase in the money supply. C. the rate of growth of the money supply is increased, leading to an increase in the price level. D. the rate of growth of the money supply is reduced, leading to a decrease in the price level.