If a monopolistically competitive firm's demand curve is shifting left, it will stop shifting only when:
A. the firm raises its price.
B. firms stop leaving the industry.
C. the firm lowers its price.
D. firms stop entering the industry.
Answer: D
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Ham and eggs are complements. If the price of ham rises, the demand for eggs will
A) increase or decrease but the demand curve for ham will not change. B) decrease and the demand curve for ham will shift rightward. C) not change but there will be a movement along the demand curve for eggs. D) decrease and the demand curve for eggs will shift leftward.
When a $10 check written on the First National Bank of Chicago is deposited in an account at Citibank, then
A) the liabilities of the First National Bank increase by $10. B) the reserves of the First National Bank increase by $ 10. C) the liabilities of Citibank increase by $10. D) the assets of Citibank fall by $10.
An individual who suffers from money illusion will
A) feel that a doubling of prices and income improves his economic position. B) concentrate on relative prices. C) never be fooled by the impact of price changes on the purchasing power of income. D) try to use counterfeit money.
A state tax assessed specifically on cigarettes is an example of
A) an excise tax. B) a consumption tax. C) a social tax. D) a tariff.