Under monopolistic competition, profits cannot persist because new firms will be attracted to the market.
Answer the following statement true (T) or false (F)
True
You might also like to view...
Refer to Table 8-28. Based on the table above, what is national income for this economy?
A) $1,950 billion B) $2,250 billion C) $2,950 billion D) $3,550 billion
Rational inattention refers to ________
A) the risk a firm runs when they do not pay attention to their customers B) firms making infrequent price decisions because of the time and effort those decision require C) the cost to the firm of losing sales from alienating customers D) all of the above E) none of the above
Consider the current peso/dollar exchange rate is 100 pesos per dollar and the current inflation rate in Mexico and the U.S. is 3 percent in each country. Assuming purchasing power parity, what will the exchange rate be if the inflation rate increases to 5 percent in Mexico and falls to 2 percent in the U.S.?
What will be an ideal response?
Using the aggregate demand and aggregate supply (AD-SRAS) framework, explain how a large-scale natural disaster would be expected to impact the economy. Discuss how an economist who believes the economy is self-regulating would view the longer term impact of such a disaster, and whether they would advocate the need for government intervention