When a resource has a perfectly inelastic supply curve
A) the amount of economic rent for this resource is determined by its supply.
B) the amount of economic rent for this resource is determined by demand for the resource.
C) the amount of economic rent for this resource is determined by the government.
D) there is no economic rent being earned by this resource.
B
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What effect does the entry of new firms in a monopolistically competitive market have on the economic profits of existing firms in the market? How might existing firms attempt to counteract this effect?
What will be an ideal response?
If the automobile industry has become highly concentrated and cartelized. To maintain profits, firms may
A. allow newcomers to favorably enter the market. B. become price takers. C. prevent entry. D. lower prices to raise revenues.
The act of putting a new product on the market in order to make profits is called
A. invention. B. innovation. C. investment. D. development.
The zero lower bound refers to the situation that
A) the lowest the central bank can decrease the nominal policy rate is 0%. B) real interest rate is 0%. C) inflation rate is 0%. D) risk premium is 0%.