Suppose the price of a can was $5.10. In this case, to maximize its profit, the firm illustrated in the figure above would
A) decrease its production and would make an economic profit.
B) not change its production and would make zero economic profit.
C) not change its production and would make an economic profit.
D) decrease its production and would incur an economic loss.
E) not change its production and would incur an economic loss.
A
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Like the monopolist, the monopolistically competitive firm:
A. sets the price where marginal cost equals marginal revenue; the demand curve doesn't matter. B. is a price taker. C. faces a downward sloping demand curve. D. All of these statements are true.
A market where there is only one seller, and buyers have no good alternative, is called
A. a monopoly. B. perfect competition. C. monopolistic competition. D. an oligopoly.
Suppose farmers get together and decide to be less productive. They want to do this so that they can shift the supply curve of farm products leftward and raise the price. They must be assuming that the demand curve between the current price and the higher price is
A) inelastic. B) elastic. C) unit elastic. D) There is not enough information to answer this question.
Under a pure price system, the decision of resource allocation is made by
A) the head of the government. B) those who have the right to vote in government elections. C) individuals who own the resources. D) no one.