When profits exist in a competitive price-searcher market,
a. rival firms will be attracted into the market.
b. high barriers to entry will prevent rival firms from entering the market.
c. product differentiation will prevent new firms from making a profit.
d. the profits will persist because the firms face a downward-sloping demand curve.
A
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The monetary base is the
A) minimum reserve banks must hold to cover any losses from unpaid loans. B) sum of coins, Federal Reserve notes, and banks' reserves at the Fed. C) sum of gold and foreign exchange held by the Fed. D) sum of government securities and loans to banks held by the Fed. E) sum of coins, required reserves, and banks' loans.
University researchers create a positive externality because what they discover in their research labs can easily be learned by others who haven't contributed to the research costs. What could the federal government do to equate the equilibrium quantity of university research and the socially optimal quantity of university research produced?
a. tax university researchers b. offer grants to university researchers c. eliminate subsidized student loans d. nothing