Since a tax imposed on buyers of a product only affects demand, such a tax has no impact on sellers in that market
a. True
b. False
Indicate whether the statement is true or false
False
You might also like to view...
Under conditions of perfect competition, profits can get squeezed out because of a
a. rising ATC curve. b. higher AR curve. c. higher MR curve. d. lower ATC curve.
What is meant by inflation targeting? Does the Fed engage in inflation targeting?
What will be an ideal response?
A monopolistically competitive firm is currently earning a positive economic profit. If other firms enter the market, we would expect that the added competition will cause this firm to adjust its output such that it
a. will operate closer to its efficient scale. b. will operate further from its efficient scale. c. will no longer be at its efficient scale. d. might move either closer to or further from its efficient scale.
The market power of a firm refers to its ability to
A. make a profit even when other firms in the industry are making losses. B. erect entry barriers in the industry. C. affect the market price for its industry's output. D. control its own output level while keeping its price the same as the prices charged by other firms.