In the simple Keynesian portion of the short-run aggregate supply curve
A. equilibrium real GDP is supply-determined.
B. equilibrium real GDP is neither determined by aggregate supply nor by aggregate demand.
C. equilibrium real GDP is demand-determined.
D. equilibrium real GDP is determined by both aggregate supply and aggregate demand.
Answer: C
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If new firms enter the computer manufacturing industry, then, holding all other things constant,
A. each “old” manufacturer must sell fewer computers than before. B. some “old” manufacturers must exit the industry. C. the equilibrium price of computers will rise. D. the equilibrium quantity demanded of computers will rise.
Which of the following is an example of implicit collusion?
A) price leadership B) a retaliation strategy C) a second-price auction D) product differentiation
A steel mill raises the price of steel by 7%, which results in a 20% reduction in the quantity of steel demanded. The demand curve facing this firm is: a. elastic
b. inelastic. c. unit elastic. d. unit inelastic.
Although monopolistically competitive markets offer consumers a wide variety of differentiated products, there may still be insufficient variety if
a. there are large fixed costs in the market. b. there are no barriers to entry in the market. c. the business-stealing externality is present in the market. d. the government does not impose regulations on the market.