A firm has a Lerner index of 0.75 and charges a price of $150. The firm's marginal cost is:
A. $112.50.
B. $0.
C. $37.50.
D. There is not sufficient information to determine the firm's marginal cost.
Answer: C
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When new firms enter a monopolistically competitive industry, each existing firm's
A) demand curve shifts rightward. B) demand curve shifts leftward. C) marginal cost curve shifts rightward. D) marginal cost curve shifts leftward.
In the short run, a firm operating in a monopolistically competitive market can earn
a. positive economic profits. b. economic losses. c. zero economic profits. d. All of the above are possible.
In corporations, which of the following are agents but not principals?
a. shareholders b. the board of directors c. managers d. workers
U.S. drug laws prohibiting re-importation of prescription drugs prevent
A. the Canadian government from dictating the drug prices to be paid by U.S. citizens. B. Canadian pharmaceutical distributors from re-selling to American citizens at lower prices. C. U.S. pharmaceutical companies from earning monopoly profits. D. American pharmaceutical distributors from re-selling to Canadian citizens at higher prices.