If firms in monopolistic competition are earning short-run profits,
a. barriers to entry will allow the profits to continue in the long run.
b. total supply in the market will decrease in the long run as firms reduce output to keep prices high.
c. the entry of new firms will eliminate the profits in the long run.
d. each existing firm will experience an increase in its average revenues in the long run.
c. the entry of new firms will eliminate the profits in the long run.
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The main reason for the high price of antiques is that
A. supply is relatively inelastic and demand tends to increase over time. B. supply is relatively elastic and demand tends to increase over time. C. demand is relatively inelastic and supply tends to increase over time. D. demand is relatively elastic and supply tends to increase over time.
A bank is said to have enough liquidity if:
A) it has enough funds to conduct its day-to-day businesses and meet the regulatory requirements. B) the value of its assets exceeds the value of its liabilities by at least $50,000. C) it operates for seven days a week for more than 12 hours a day. D) it holds deposits amounting to at least $100,000.
If there is a basic surplus but a positive total deficit, then
A) interest cost > basic surplus. B) interest cost < basic surplus. C) interest cost > positive total deficit. D) interest cost < positive total deficit.
If a firm's marginal revenue is below its marginal cost, an increase in production will usually
a. increase profits. b. leave profits unchanged. c. decrease profits. d. increase marginal revenue.