One symptom of the inefficiencies associated with monopolistic competition is industry wide excess capacity.
Answer the following statement true (T) or false (F)
True
The typical firm in a monopolistically competitive market produces at a rate of output that is less than its minimum-ATC output rate. This implies that the same level of industry output could be produced at lower cost with fewer firms.
You might also like to view...
Suppose the working-age population is 500 million, the labor force is 200 million, and the unemployment rate is 15 percent. The number of unemployed people is
A) 30 million. B) 75 million. C) 45 million. D) 105 million. E) 15 million.
If the GDP deflator in the United States is 114, and the GDP deflator in Ukraine is 142, which of the following exchange rates would the theory of purchasing power parity predict in the long run? (The Ukrainian currency is the hryvnia.)
A) 0.80 hryvnias per dollar B) 1.25 hryvnias per dollar C) 2.80 hryvnias per dollar D) 28 hryvnias per dollar
Private saving is defined as
A) private disposable income minus consumption. B) net national product minus consumption. C) private disposable income minus consumption plus interest. D) private disposable income minus consumption plus interest plus transfer payments.
Matt has decided to purchase his textbooks for the semester. His options are to purchase the books online with next day delivery at a cost of $175, or to drive to campus tomorrow to buy the books at the university bookstore at a cost of $170. Last week he drove to campus to buy a concert ticket because they offered 25 percent off the regular price of $16. Assume the minimum that Matt would be willing to accept to drive to campus is equal to the $4 he saved on the concert ticket. What would his economic surplus be if he bought his textbooks at the university bookstore rather than online?
A. $5 B. $50 C. $20 D. $1