In the long run, a profit-maximizing monopolistically competitive firm sells at a price that is:
A. equal to average total cost.
B. equal to marginal cost.
C. below average total cost
D. the same as in perfect competition.
A. equal to average total cost.
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Moral hazard is the
A) outcome of a Prisoner's Dilemma. B) result of market signaling. C) risk associated with a Dutch auction. D) risk that one party to a contract may alter its post-contract behavior to the detriment of another party.
Which type of unemployment is most likely to help an economy become more efficient?
a. Cyclical unemployment b. Voluntary unemployment c. Seasonal unemployment d. Frictional unemployment e. Underemployment
The firm's demand curve and the industry's demand curve are identical in the _________ market structure(s)
a. monopoly b. oligopoly c. monopolistic competition d. perfect competition e. perfect competition and monopolistic
Income elasticity of demand reflects
A) the change in total quantity demanded divided by the total change in income. B) the responsiveness of the quantity demanded to changes in income, adjusting its relative price so real income does not change. C) the responsiveness of income of producers to a change in quantity sold of the good. D) the responsiveness of demand to changes in income.