In the long run, monopolistically competitive firms have:
A. excess capacity.
B. positive profits.
C. minimal average costs.
D. homogeneous production.
Answer: A
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Refer to Figure 4-5. The figure above represents the market for pecans. Assume that this is a competitive market. If the price of pecans is $9
A) too many consumers want to buy pecans. B) economic surplus is maximized. C) the quantity demanded is economically efficient but the quantity supplied is economically inefficient. D) the quantity supplied is greater than the economically efficient quantity.
Suppose the nominal interest rate is 4 percent annually, and you deposit $1,000. Inflation in the economy throughout the year is 5 percent. At the end of the year, you have earned:
A. a real rate of return of 1 percent. B. an increase in your purchasing power. C. a nominal increase in your savings of $40. D. All of these statements are true.
Which of the following statements is true?
a. The quantity of natural resources per worker can influence productivity. b. Technological knowledge and human capital are closely related. c. Over long periods of time, the prices of most natural resources are stable or falling, relative to other prices. d. All of the above are correct.
According to Keynes, the primary determinant of Amy's saving is
A. the level of Amy's real current income. B. the level of Amy's consumption spending. C. the real interest rate. D. the nominal interest rate.