One assumption of the perfectly competitive model is free entry and exit. This assumption most directly leads to the implication that:
A. positive economic profit is only possible in the short run.
B. a long-run equilibrium cannot be achieved.
C. firms will compete on the basis of better service rather than lower prices.
D. firms will have to spend money on advertising.
Answer: A
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Refer to Table 16-3. If Julie charges $10 per hour, how many hours of pet sitting services will be purchased and by whom?
A) 3 hours (1 hour each by Arun, Bernice, and Cara) B) 2 hours (1 hour by Cara and 1 hour by Dawn) C) 1 hour by Cara only D) 1 hour by Dawn only
Economic goods are defined as
A) tangible items only. B) services only. C) anything from which an individual derives satisfaction. D) any item which is available in sufficient quantity at zero price.
Intertemporal decisions are
a. decisions in one period of time. b. decisions over time. c. decisions made without thinking about time. d. decisions involving infinity.
Your local government needs to increase tax revenue. To increase tax revenue it can either increase the property tax on commercial property or increase the property tax on all property. The government wants to impose the smallest excess burden possible. Because the demand for commercial property is ________ elastic than the demand for all property, you recommend that local government increase the property tax on ________ property.
A. less; commercial B. more; all C. less; all D. more; commercial