Suppose that Figure 10.4 shows an industry's market demand, its marginal revenue, and the production costs of a representative firm. If the industry was perfectly competitive, a representative firm's profit would be:
A. $1,250.
B. $450.
C. $250.
D. There is not sufficient information.
Answer: D
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The above figure shows the market for pizza. The market is in equilibrium when people learn that eating pizza helps prevent heart disease. What point represents the most likely new price and quantity?
A) A B) B C) C D) D E) E
Market failure is the inability of
a. buyers to interact harmoniously with sellers in the market. b. a market to establish an equilibrium price. c. buyers to place a value on the good or service. d. some unregulated markets to allocate resources efficiently.
Studies of NAFTA have concluded that free trade caused ______ in the variety of U.S. imports from Mexico.
a. decreases b. increases c. no change d. slight decreases
In long-run equilibrium for a monopolistically competitive firm, the firm's ________ curve is just tangent to its average total cost curve.
A. demand B. supply C. marginal revenue D. marginal cost