In the long run:
A. some inputs can be varied and no inputs are fixed.
B. all inputs can be varied and no inputs are fixed.
C. some inputs can be varied and some inputs are fixed.
D. no inputs can be varied and all inputs are fixed.
Answer: B
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A free market fails when
A) firms that produce goods which create positive externalities go bankrupt. B) firms that produce goods which create negative externalities earn high profits. C) there is an external effect in either production, consumption, or both. D) there is government intervention.
Which of the following characteristics does perfect competition have in common with monopolistic competition?
a. price-taking firms b. homogeneous products c. no barriers to entry d. horizontal demand curve e. neither market advertises
The price elasticity of a vertical demand curve is always
a. infinitely large. b. zero. c. one. d. increasing as price increases.
For a monopoly, where demand is ________ , marginal revenue is ________ , and total revenue ________ as the price falls
a. inelastic; positive; increases b. inelastic; negative; decreases c. elastic; positive; increases d. elastic; negative; increases