Which one of the following statements is TRUE for BOTH perfect competition and monopolistic competition?
A) Each type of firm faces a downward sloping demand curve.
B) Each type of firm produces a homogeneous product.
C) In the long run, firms in both industries make zero economic profit.
D) Each type of firm competes on product quality and price.
C
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The principle of voluntary exchange is based on the idea of
A) making assumptions. B) rational self-interest. C) thinking at the margin. D) isolating variables.
Monetarists directly study the link between money and economic activity using
A) structural models. B) reduced-form models. C) scientific models. D) experimental models.
A U.S. grocery store chain bought $800,000 worth of Kenyan currency from a bank in Kenya. It then used these funds to buy $800,000 worth of coffee from Kenyan coffee growers. As a result of this exchange, by how much and in which direction did: A. U.S. net exports change? B. U.S. net capital outflow change?
In the definition of marginal propensity to consume, marginal refers to ______.
a. the amount of extra taxes someone pays as a result of government purchases b. the total income someone receives as a result of government purchases c. the additional amount of disposable income someone receives d. the amount of additional income spent on consumer goods and services