When a firm faces a horizontal demand curve,
A. the marginal cost curve is upward sloping.
B. the market price is also the firm’s marginal revenue.
C. the market demand curve is also a horizontal line at the market price.
D. entry by new firms is unlikely.
Answer: B
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The table shows the balance sheet for Ralph's Bank. If the desired reserve ratio is 15 percent, the maximum additional amount that Ralph's Bank can loan is equal to ________
A) $50 B) $500 C) $450 D) $2,500
Resource owners will supply additional units of a resource as long as doing so
a. decreases their opportunity cost b. increases their income c. increases their utility d. decreases their income taxes e. improves their working conditions
Adam Smith suggested that an invisible had guides market economies. In this analogy, what is the baton that the invisible hand uses to conduct the economic orchestra?
a. the government b. prices c. subsidies d. the Federal Reserve
According to Paul Romer, if a country can grow continuously if it ______.
a. increases its population size at a rate of at least 2 percent annually b. offsets diminishing returns through technological innovation c. encourages its citizens to consume at least 93 percent of their incomes d. has abundant natural resources within its borders