In a monopolistically competitive market, as the number of product variants decreases, the price of a particular firm's product is likely to ________ because the demand for each variety becomes more
A. increase; inelastic.
B. increase; elastic.
C. decrease; elastic.
D. decrease; inelastic.
Answer: A
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Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the real GDP and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. Real GDP falls, and reserve-related (central bank) transactions become more negative (or less positive). b. Real GDP falls and reserve-related (central bank) transactions remain the same. c. Real GDP and reserve-related (central bank) transactions remain the same. d. Real GDP rises, and reserve-related (central bank) transactions remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
When taxes increase, consumption
a. decreases as shown by a movement to the left along a given aggregate-demand curve. b. decreases as shown by a shift of the aggregate demand curve to the left. c. increases as shown by a movement to the right along a given aggregate-demand curve. d. increases as shown by a shift of the aggregate demand curve to the right.
Unemployment rates differ widely among various groups in the population.
Answer the following statement true (T) or false (F)
Professor Jeremy Siegel, of the University of Pennsylvania, conducted research that showed that:
A. over the long run, stocks have been less risky than bonds. B. over the long run, bonds frequently outperform stocks. C. investors should only own stocks for short periods of time to maximize returns. D. over the long run, bonds have been less risky than stocks.