Product homogeneity is a standard assumption in the traditional theory of pure competition.
a. true
b. false
Answer: a. true
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The short-run aggregate supply curve is positively sloped. Which of the following is not one of the explanations given in the text?
a. the misperception effect b. Sticky wage theory c. market effect d. All of the above are explanations of the profit effect.
The highest amount of output an economy can sustainably produce and sell using existing production processes and resources is called:
A. nominal output. B. potential output. C. actual output. D. utilized output.
A production possibilities curve always slopes downward to the right because resources
A. are not scarce. B. have no opportunity cost. C. are freely available. D. are limited. E. are not related to outputs.
The economic problem is essentially one of deciding how to make the best use of
A. limited resources to satisfy limited wants. B. unlimited resources to satisfy limited wants. C. limited resources to satisfy unlimited wants. D. unlimited resources to satisfy unlimited wants.