If farmers decide individually whether or not to vaccinate their cattle against mad cow disease, which of the following is true?
a. The equilibrium quantity is too low for efficiency.
b. The equilibrium price and quantity are too high for efficiency.
c. The equilibrium price is efficient.
d. The equilibrium quantity is too high for efficiency.
e. The equilibrium price and quantity are efficient.
A
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In the long run, monopolistic competitive firms are considered to be operating inefficiently because their
A) economic profits are positive. B) economic profits are zero. C) average total costs are not at a minimum. D) marginal costs are rising.
If an important assumption is omitted from an economic model,
A) the model's predictions will be accurate 50% of the time. B) the model's predictions will be inaccurate. C) the model will not predict anything. D) the model will be rejected by other economists.