If a monopolistically competitive firm lowers its price and, as a result, its total revenue decreases then
A) the output effect of the price change was less than the price effect.
B) the output effect of the price change was greater than the price effect.
C) the substitution effect of the price change was greater than the income effect.
D) the firm's demand curve must have decreased.
A
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Inequality in the distribution of income in the United States today arises primarily from
A) the collapse of the government's income support system. B) the highly unequal distribution of corporate wealth. C) the tax system. D) the weakness of labor unions. E) unequal abilities to supply valuable human services.
Our currency is issued by
A. the United States Treasury. B. the Federal Reserve. C. individual commercial banks. D. the Internal Revenue Service.
If a monopolistically competitive firm raises its price, it
a. loses all of its customers (sales drop to zero) b. loses some, but not all, of its customers c. loses very few customers d. loses no customers at all e. gains customers (sales increase)
With a flat tax,
A. Decisions are based on economic considerations rather than tax incentives. B. Everyone pays the same amount of absolute tax. C. The government's ability to change the mix of output is increased. D. Vertical inequities cannot occur.