The entry of new firms into a perfectly competitive market will cause:
A) both the equilibrium price and quantity to increase.
B) both the equilibrium price and quantity to decrease.
C) the equilibrium price to increase but the equilibrium quantity to decrease.
D) the equilibrium price to decrease but the equilibrium quantity to increase.
D
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Bidding in a Dutch auction continues until ________
A) no bidder is willing to bid any higher B) a bidder accepts the price announced by the auctioneer C) a bidder bids above the market price of the good D) a bidder bids below the starting bid
Suppose the United States pursued an expansionary fiscal policy to stimulate its economy and eliminate a recession. The crowding-out effect suggests that:
A. net exports would increase, thus increasing aggregate demand and partially reinforcing the fiscal policy. B. private investment would decrease, thus increasing aggregate demand and partially offsetting the fiscal policy. C. private investment would decrease, thus decreasing aggregate demand and partially offsetting the fiscal policy. D. net exports would increase, thus decreasing aggregate demand and partially offsetting fiscal policy.