Firms who effectively differentiate their product from their competitors' products do so by having:
A. perceived, but not real, differences in product design.
B. real, not just perceived, differences in product design.
C. real or perceived differences in product design.
D. None of these statements is true.
Answer: C
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The main function of the 1997 Stability and Growth Pact (SGP) was to
A) exclude a highly indebted EMU country B) enhance cooperation between France and Germany. C) make the Euro a weak currency. D) distribute the Euro banknote among European central banks and to create a timetable for the imposition of financial penalties on countries that fail to correct situations of "excessive" deficits and debt promptly enough. E) determine specialized penalties for each member nation.
The perfectly competitive firm faces
A) a downward sloping demand curve. B) a horizontal supply function. C) perfectly elastic demand. D) constant marginal costs.