Since a monopolistically competitive firm faces a ____ demand curve, it will always operate ____ in long-run equilibrium
a. perfectly elastic; with excess capacity
b. downward-sloping; with excess capacity
c. downward-sloping; at an economically efficient scale
d. perfectly inelastic; at an economically efficient scale
b
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The second fundamental theorem of welfare economics states that
A) under certain conditions, a competitive equilibrium is Pareto optimal. B) a competitive equilibrium is always Pareto optimal. C) under certain conditions, a Pareto optimum is a competitive equilibrium. D) a Pareto optimum is always a competitive equilibrium.
Which of the following is not an interest-earning asset of commercial banks?
a. Required reserves. b. Checkable deposits. c. Customer savings accounts. d. All of the above are interest-earning assets of commercial banks. e. None of the above are interest-earning assets of commercial banks.
Pete owns a small store. He has noticed that when he is not at the store monitoring his employees, his revenue goes down. What are two changes Pete could make to wages he pays his employees to correct this problem?
A positive temporary supply side shock will:
A. increase the level of potential output in the long run. B. decrease the price level in the long run. C. increase the price level in the long run. D. have no effect in the long run.