In long-run equilibrium, purely competitive markets:
A. minimize total cost.
B. maximize the sum of consumer surplus and producer surplus.
C. yield economic profits to most sellers.
D. inevitably degenerate into monopoly in increasing-cost industries.
Answer: B
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In a Malthusian world, what events would improve permanently the standard of living, as measured by output per capita?
A) a peace keeping mission B) an increase in violent crime C) a new mutation of germs D) a new sewer system
Termination
What will be an ideal response?
The greater the flow of investment spending, the greater the increase in the stock of:
A. saving. B. income. C. capital. D. money.
Which of the following statements would Milton Friedman agree with concerning the conduct of monetary policy?
A. Information lags are short, enabling the central bank to respond quickly to changes in the economy. B. Wage and price adjustments are relatively slow, so changing the money supply will have a minimal impact on the real economy. C. There is little uncertainty over the effect of a change in the money supply on the economy. D. There are long and variable lags between monetary policy actions and their economic results.