The purchase of 500 shares of Honda stock by the California State Employees' Pension fund
A) is counted as consumption expenditure.
B) is not counted as part of GDP.
C) is counted as investment in the GDP accounts.
D) is counted as part of export expenditure in the GDP accounts because Honda is a foreign firm.
E) is counted as part of import expenditure in the GDP accounts because Honda is a foreign firm.
B
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Which of the following statements is true about advertising by a monopolistically competitive firm?
A) Since the monopolistic competitor, like the perfect competitor, makes zero profit in the long run, it is a waste of resources to advertise its products. B) Advertising could make the monopolistic competitor's demand more inelastic, but advertising has no effect on a perfect competitor's demand. C) Monopolistically competitive firms tend to shun advertising because advertising draws attention to the variety of differentiated products available in the industry. D) Advertising will be more beneficial if a monopolistic competitor colludes with other firms to advertise the products of the industry as a whole rather than an individual firm's product.
If minimum average cost is the same over a large range of output,
a. the market will evolve into a natural monopoly b. minimum efficient scale is large as well c. only a few large firms will survive in the long run d. smaller firms have a cost advantage over larger firms e. firms of varying sizes can coexist