A monopolistically competitive firm chooses
A) both the quantity of output to produce and the price at which it will sell its output.
B) the price of the product it sells but market forces determine the quantity it will be able to sell.
C) the quantity of output to produce but the price of the product it sells is determined collectively by all firms in the industry.
D) the price of the product it sells but the quantity of output to produce is agreed upon by all firms in the industry.
Answer: B
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Refer to Table 2-4. Assume Dina's Diner only produces sliders and hot wings. A combination of 60 sliders and 25 hot wings would appear
A) along Dina's production possibilities frontier. B) inside Dina's production possibilities frontier. C) outside Dina's production possibilities frontier. D) at the vertical intercept of Dina's production possibilities frontier.
An increase in the price level will increase the interest rate, which will decrease investment spending and shift aggregate demand to the left
a. True b. False