In perfect competition, the marginal revenue curve
A. intersects the demand curve when marginal revenue is minimized.
B. is always below the demand curve facing the firm.
C. and the demand curve facing the firm are identical.
D. is always above the demand curve facing the firm.
Answer: C
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A large increase in oil prices is an example of:
A. inflation inertia. B. an adverse inflation shock. C. a favorable inflation shock. D. excessive aggregate spending.
The players in a game theory situation often do not act in their joint interest because of which of the following?
A) They do not realize the benefit of cooperation. B) Players strive to minimize their opponents' profits. C) Players do not understand the game and its payoffs. D) It is not in each player's self-interest to cooperate. E) Players understand the game but they do not know which action(s) will benefit their joint interest.
In perfect competition, the market demand for the good ________ perfectly elastic and the demand for the output of one firm ________ perfectly elastic
A) is; is B) is; is not C) is not; is D) is not; is not
A rightward shift in the demand curve for tennis balls could be caused by
A) a fall in the price of tennis balls. B) a fall in the price of tennis rackets. C) a rise in the price of tennis lessons. D) a fall in income, assuming tennis balls are a normal good.