Assuming instead that the market depicted in Figure 8.1 is perfectly competitive, the equilibrium price and output would be:

In a market that is contestable, but has only a few sellers, the

a. threat of new entrants will prevent prices from rising above the competitive level. b. producers will be able to charge prices that are high enough to produce long-run economic profits. c. producers will not face new competition because the barriers to entry are high. d. market will never be expected to come close to the competitive result.

Which one of the following is TRUE?

A. Investments in secondary education produce gains in the form of economic growth. B. New growth theory suggests that there is no connection between the level of education in a country and its rate of economic growth. C. Secondary education does not boost economic growth in developing nations, because so much of the workforce remains in agriculture. D. New growth theory suggests that education benefits only those people who receive it, and not the population as a whole.