One World View article is titled "Flat Panels, Thin Margins." New firms continue to enter the industry even though prices are falling because
A. Normal profits are being earned.
B. Economic profits are being earned.
C. Total costs are greater than total revenues.
D. Total costs equal total revenues.
Answer: B
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In an attempt to manage expectations, a central bank may prefer to announce an unconditional commitment, because an unconditional commitment ________ than a conditional commitment
A) is inherently more credible B) may have an impact on expectations that is stronger C) places fewer constraints on policy makers D) is less likely to have unintended consequences
Suppose there are 100 consumers with identical individual demand curves. When the price of a movie ticket is $8, the quantity demanded for each person is 5. When the price is $4, the quantity demanded for each person is 9. Assuming the law of demand holds, which of the following choices is the most likely quantity demanded in the market when the price is $6?
A. 700 B. 1,200 C. 400 D. 1,000