How is a monopolistically competitive firm similar to a perfectly competitive firm?
A) Both will observe entry into the industry if economic profit is positive.
B) Both produce where average total cost equals marginal cost.
C) Both make a positive economic profit in the long run.
D) Both produce a homogeneous good.
A
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If the Fed lowers the federal funds rate, which of the following occurs?
A) Investment increases. B) Consumption expenditure decreases. C) The price of the dollar on the foreign exchange market increases. D) Net exports decrease. E) Government expenditure on goods and services increases.
Which of the following cases are examples of industries that have potentially increasing costs due to scarce inputs?
A) Petroleum production B) Medical care C) Legal services D) all of the above
Fiscal policy time lags tend to be
A) constant, always thirteen months long. B) variable, between one and three years. C) variable, between one and three weeks. D) variable, between one and three months.
The welfare loss associated with the outcome in a competitive oligopoly is:
A. bigger than that of a monopoly. B. smaller than that of a monopoly. C. the same as that of a monopoly. D. the same as that of colluding oligopolists.