When firms in a competitive market have different costs, it is likely that
a. free entry and exit in the market will be violated.
b. the market will no longer be considered competitive.
c. long-run market supply will be downward sloping.
d. some firms will earn positive economic profits in the long run.
d
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A cartel is most likely to occur in
A) perfect competition as firms compete by reducing cost. B) oligopoly as firms act together to raise prices and increase profits. C) monopolistic competition where firms collude to increase profits. D) oligopoly as firms compete to lower price and increase their own profits. E) monopoly because it faces no competition.
Pleasure boaters enjoy the use of waterways, but sometimes run into problems and need rescue. Coast Guard boats, supported by tax revenue, are often used for rescue. Is it likely that there will be an efficient amount of boating and rescuing?