Why does a monopolist face the market demand curve?
a. Presence of a large number of substitutes
b. Presence of a large number of buyers in the market
c. Barred entry of any new firm in the market
d. Produces a homogeneous product
e. Consumers have perfect knowledge of the market
c
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Distinguish the short run from the long run. Generally, what causes costs of production to vary with output in the short run? What generally causes costs of production to vary in the long run?
What will be an ideal response?
A year-long drought that destroys most wheat crops for the season would shift the:
A. short-run aggregate supply curve only. B. aggregate demand curve only. C. aggregate demand curve, and the short-run aggregate supply curve would shift in response. D. short-run aggregate supply curve and the long-run aggregate supply curve.
Which of the following is not a way in which monopolies fight real-world competition?
A. Advertising B. Charging a very high price for their products C. Lobbying D. Producing products that are difficult to copy
Consider the market for euros. Suppose the exchange rate is ________ its equilibrium. This means that the quantity of euros ________ is greater than the quantity of euros ________ and the exchange rate will ________
A) above; supplied; demanded; fall B) below; supplied; demanded; rise C) above; demanded; supplied; fall D) below; demanded; supplied; fall