Which of the following is not characteristic of monopolistic competition?
A. Some market power.
B. Low concentration ratios.
C. Firms have zero control over price.
D. Many firms in an industry.
Answer: C
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If the price of inputs falls and the budget deficit rises due to an increase in government spending, then the:
a. Price index rises, and real GDP falls. b. Price index is uncertain, and real GDP rises. c. Price index rises, and the change in real GDP is uncertain. d. Price index falls, and real GDP rises. e. Price index falls, and real GDP falls.
If the government of India implemented a policy that decreased national saving, its real exchange rate would
a. depreciate and Indian net exports would rise. b. depreciate and Indian net exports would fall. c. appreciate and Indian net exports would rise. d. appreciate and Indian net exports would fall.
Which of the following is NOT included in the money supply when the transactions approach is used?
A. money market deposit accounts B. currency C. traveler's checks D. transaction deposits
A movie theater raises ticket prices from $8 to $10 in order to raise revenues. The theater's management is assuming the absolute value of the price elasticity of demand for tickets is
A) less than 1. B) greater than 1. C) equal to 1. D) infinity.