Answer the following questions true (T) or false (F)
1. Monopolistic competition differs from oligopoly in that in monopolistic competition firms act independently while in oligopoly firms act interdependently.
2. An entry barrier exists when firms in an industry charge the lowest price possible for their products.
3. If economies of scale are significant, the typical firm will not reach the minimum point on its long-run average cost curve until it has produced a large fraction of industry sales.
1. TRUE
2. FALSE
3. TRUE
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In years when teenagers become a greater percentage of the labor force,
A) the natural rate of unemployment falls. B) the natural rate of unemployment rises. C) the inflation rate rises. D) the inflation rate falls.
The behavior of the monopolistic firm:
a. maximizes the benefits to consumers, given the resources available to the economy. b. reduces output in order to raise prices in the short-term c. results in excess capacity and inefficiency. d. both b and c