Which of the following is NOT a characteristic of perfect competition?
A) Firms are "price takers."
B) All firms sell identical products.
C) There are substantial barriers to entry into the industry.
D) There are many buyers and sellers.
Answer: C
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Contractors can use plywood or brick to construct walls. Suppose the price of bricks increases. Which of the figures above best illustrates the effect of this change on the market for plywood?
A) Figure A B) Figure B C) Figure C D) Figure D E) Figure A or Figure C depending on how contractors react to the higher price of bricks.
Along a single indifference curve,
A. the slope remains constant. B. the slope increases as the quantity of a good increases. C. the slope is negative. D. the slope is always between 0 and 1.
Which of the following is NOT a feature of a common market?
A) Substantial coordination of macroeconomic policies among the members B) Free trade in goods and services between the members C) Common external barriers to trade D) Factor mobility
The circular-flow diagram illustrates that:
A) production generates income so that income and production are the same. B) the economy's income is less than its production. C) the economy's income is exceeds its production. D) none of the above are necessarily correct.