In long-run equilibrium, compared to a perfectly competitive market, a monopolistically competitive industry produces a ________ level of output and charges a ________ price
A) higher; lower
B) lower; lower
C) lower; higher
D) higher; higher
Answer: C
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Suppose that interdiction efforts have stemmed the flow of illegal drugs into the United States. If there is no change in demand, this leads to higher prices for these substances. The result is an increase in crime as users attempt to maintain their now more expensive habits. Economists would call this effect
A. the illusion of rationality. B. an externality. C. the cost disease of personal services. D. inflation. E. unemployment.
If two goods are substitutes, their cross-price elasticity will be
a. positive. b. negative. c. zero. d. equal to the difference between the income elasticities of demand for the two goods.
Because of automatic stabilizers, when GDP fluctuates the...
What will be an ideal response?
The supply of workers in a particular occupation could be relatively large if:
A. training costs are low. B. job features are undesirable. C. there are few people with the required skills. D. there are artificial barriers to enter that profession.