Because of the number of firms in monopolistic competition,
A) each firm has a large market share.
B) it is possible for the firms to collude.
C) no one firm can dominate the market.
D) one firm has the ability to dictate market conditions.
E) each firm must carefully monitor what its competitors do.
C
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Along a downward-sloping linear demand curve, total revenue is greatest if demand is
a. inelastic b. elastic c. inelastic when prices are high d. elastic when prices are high e. unit elastic
Mainstream economists support
A. elimination of efficiency wages and insider-outsider relationships. B. the use of fiscal policy for achieving major economic goals. C. adoption of a monetary rule for increases in the money supply. D. the requirement that the government annually balance its budget.
Answer the following statement true (T) or false (F)
1) Elasticity of resource demand is measured by dividing "percentage change in resource price" by "percentage change in resource quantity." 2) An increase in the price of capital will reduce the demand for labor if capital and labor are complementary resources. 3) The marginal productivity theory of income distribution holds that all resources are paid according to their marginal contribution to society's output. 4) The marginal productivity theory of income distribution holds that all resources are paid according to their marginal contribution to society's output.
For this question, assume that expectations of P and A are correct. Now suppose that there is a 1% increase in A. Given this information, which of the following will occur?
A) a 1% increase in the real wage and a reduction in the natural rate of unemployment B) a 1% increase in the real wage and no change in the natural rate of unemployment C) no change in the real wage and an increase in the natural rate of unemployment D) no change in the real wage and a reduction in the natural rate of unemployment