A perfectly competitive market is one where:
A. each firm controls the price charged for its product by changing the quantity they produce.
B. each firm sells at the government mandated price.
C. each firm within the market must sell its good at the market price.
D. a firm can affect market price by increasing output.
Answer: C
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Boeing Corporation and Airbus Industries are the only two producers of long-range commercial aircraft. This market is not perfectly competitive because:
A) each company has annual sales over $10 billion. B) each company can significantly affect prices. C) Airbus receives subsidies from the European Union. D) Airbus cannot sell aircraft to the United States government. E) all of the above
Another term for equilibrium price is
a. dynamic price. b. market-clearing price. c. quantity-defining price. d. balance price.
As chief financial officer you sell newly issued bonds on behalf of your firm. Your firm is
a. borrowing directly. b. borrowing indirectly. c. lending directly. d. lending indirectly.