In the electric guitar market, the quantity demanded is significantly greater than the quantity found at the bottom of the LRAC. Given this information, which of the following will likely occur?
a. Multiple firms will compete in the electric guitar market.
b. One firm will manufacture and sell electric guitars.
c. Most electric guitar firms will experience diseconomies of scale.
d. A monopoly will form in the electric guitar industry.
a. Multiple firms will compete in the electric guitar market.
If the quantity demanded in the market of a certain product is much greater than the quantity found at the bottom of the long-run average cost curve, where the cost of production is lowest, the market will have many firms competing.
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Fluctuations in total output are the reverse image of fluctuations in
A) the inflation rate. B) the unemployment rate. C) gross domestic product. D) the GDP deflator.
With a pure gold standard
A) a nation may not pursue an independent monetary policy. B) an inflow of gold will reduce the money supply of a country. C) there will be a tendency for a too rapid increase in the volume of world trade. D) a balance of payments deficit will lead to an increase in the domestic price level.
Once marginal costs rise above the average cost,
a. Average cost increases b. Average cost decreases c. Average costs will stay the same d. None of the above
When an infinite value is placed on human life, policymakers who rely on cost-benefit analysis
a. are forced to pursue any project in which a single human life is saved. b. are likely to make decisions that optimally allocate society's scarce resources. c. would not pursue any public project that would not save human life. d. would be forced to rely on private markets to provide public goods.