If firms in a competitive price-searcher market are currently earning economic losses, then in the long run,
a. new firms will enter the market, and the current firms will experience a decrease in demand for their products until zero economic profit is again restored.
b. new firms will enter the market, and the current firms will experience an increase in demand for their products until zero economic profit is again restored.
c. some existing firms will exit the market, and the remaining firms will experience an increase in demand for their products until zero economic profit is again restored.
d. some existing firms will exit the market, and the remaining firms will experience a decrease in demand for their products until zero economic profit is again restored.
C
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At the point at which the consumption function intersects the 45 degree reference line
A) planned real consumption of real disposable income equals zero. B) planned real saving equals real disposable income. C) planned real consumption equals real disposable income. D) equilibrium output is supply determined equilibrium output is determined by both.
Real interest rates are the
A) interest rates quoted in the market. B) interest rates quoted in the market plus the expected inflation rate. C) nominal interest rates plus the inflation rate. D) interest rates quoted in the market minus the inflation rate.
If some sellers exit a competitive market, how will this affect its equilibrium?
What will be an ideal response?
From the standpoint of the economy as a whole, the role of insurance is to greatly reduce or eliminate the risks inherent in life
a. True b. False Indicate whether the statement is true or false