Monopolistically competitive firms prevent the efficient use of resources because in long-run equilibrium,
A. price is greater than marginal cost.
B. price equals marginal cost.
C. price is less than marginal cost.
D. marginal cost is greater than average total cost.
Answer: A
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Inferior goods have negative income elasticities
a. True b. False Indicate whether the statement is true or false
The output effect describes the situation when a monopolist sells more output and, all else equal, total revenue
a. increases. b. decreases. c. is unchanged. d. is maximized.
Which represents the percentage of all U.S. businesses that are corporations, and the percentage of all goods that those corporations sell?
a. 10% of businesses; 50% of goods sold b. 20% of businesses; 50% of goods sold c. 20% of businesses; 90% of goods sold d. 50% of businesses; 75% of goods sold
Stock prices may rise from a reduction in interest rates because:
A. the present value of future earnings will increase. B. financial market participants are less optimistic about future earnings. C. the present value of future earnings will decrease. D. stockholders will expect lower future earnings.