Innovation and new ideas are rewarded in a nation with a traditional economy.

The financial situation at Starbucks in the late 2000s illustrates the fact that maintaining long-run profits in a monopolistically competitive market is

A. very difficult. B. impossible. C. almost always guaranteed. D. fairly easy.

When producing a good creates pollution, an external cost, and the government imposes a tax equal to the marginal external cost, then

A) the amount of output moves farther away from the efficient amount. B) transaction costs will be high. C) the efficient amount of the good will be produced. D) property rights must have already been established.