Which of the following is NOT a characteristic of perfect competition?
A) There are many buyers and sellers.
B) Each firm determines the market price of its product.
C) Products are homogeneous.
D) Buyers and sellers have equal access to information.
Answer: B
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Shortly after World War II (1941–45) and the price controls ended,
(a) unemployment levels returned to those levels experienced during the Great Depression. (b) unemployment levels returned to their full employment levels. (c) unemployment dipped sharply and inflation surged. (d) unemployment rates increased and deflation emerged.
Suppose real GDP is $800 billion when the MPC is 0.80, and people decide to increase their saving by $30 billion. Before this change, the economy was in equilibrium with people intending to save $100 billion and producers intending to invest $100 billion. The new equilibrium level of real GDP is:
a. $600 billion. b. $650 billion. c. $680 billion. d. $730 billion. e. $800 billion.
Transfer prices should be set to so
A) to maximize profits for only one unit in a multi-unit firm. B) allow arbitrage with the external market place. C) to maximize profits for the overall firm. D) none of these choices.
After much anticipation a company releases a new smartphone. The smartphone doesn't work as well as expected and lacks many of the features buyers had been expecting. The unexpectedly negative reaction to the smartphone would
a. raise the present value and the price of the corporation's stock. b. raise the present value and reduce the price of the corporation's stock. c. reduce the present value and the price of the corporation's stock. d. reduce the present value and raise the price of the corporation's stock.