Monopolistic competition is similar to a monopoly because firms in both industries
A. sell products with no close substitutes.
B. sell differentiated products.
C. have freedom of entry and exit.
D. have some control over price.
D. have some control over price.
You might also like to view...
The democratic political process operating at the national level tends to result in
A) balanced budgets. B) deficits. C) surpluses. D) surpluses alternating with deficits in a countercyclical manner.
If a competitive firm cannot earn profit at any level of output during a given short-run period, then which of the following is LEAST likely to occur?
A) It will shut down in the short run and wait until the price increases sufficiently. B) It will exit the industry in the long run. C) It will operate at a loss in the short run. D) It will minimize its loss by decreasing output so that price exceeds marginal cost.
Crowding out occurs when the government
a. reduces the level of the national debt, forcing up interest rates b. balances the budget, increasing the value of government bonds and thereby causing consumption to fall c. borrows money to finance the national debt, forcing up interest rates, causing private investment to fall d. borrows money to finance the national debt, causing interest rates to fall causing private investment to fall e. borrows money to finance the national debt, forcing up interest rates, causing consumption to fall
The elimination of the federal budget deficit in the 1990s put downward pressure on real interest rates
a. True b. False Indicate whether the statement is true or false