Even if the steel industry is an oligopoly, there may be more firms competing with the steel firms than you would think because
a. economies of scale exist
b. barriers to entry can be overcome
c. firms in other industries producing close substitutes may compete in the markets in which steel firms compete
d. economic profit lures other firms into the industry
e. there is high product differentiation
C
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What will be an ideal response?
A 25% decrease in the price of breakfast cereal leads to a 20% increase in the quantity of cereal demanded. As a result: a. total revenue will decrease
b. total revenue will increase. c. total revenue will remain constant. d. the elasticity of demand will increase.
The argument that each person should pay taxes according to how well the individual can shoulder the burden is called
a. the ability-to-pay principle. b. the equity principle. c. the benefits principle. d. regressive.
When something happens to the economy, monetarists ask two questions:
A. What does this do to government spending, and what does it do to tax revenues? B. What does this do to real GDP, and what does it do to the price level? C. What does this do to investment spending, and what does it do to net exports? D. What does this do to the money supply, and what does it do to velocity?