A necessary condition for the operation of a perfectly competitive market is free entry and exit from the market.
Answer the following statement true (T) or false (F)
True
As long as it's easy for existing producers to expand production or for new firms to enter an industry, economic profits won't last long. One of the driving forces of the competitive market is the relentless squeeze on profits.
You might also like to view...
Assuming all else equal, if a household is optimistic about future income, it is likely to cause:
A) the current credit supply curve of the household to shift to the left. B) an upward movement along the current credit supply curve of the household. C) the current credit supply curve of the household to shift to the right. D) a downward movement along the current credit supply curve of the household.
Which of the following would those in favor of increasing government spending rather than decreasing taxes to prop up aggregate demand probably not agree with?
a. Traditional Keynesian analysis indicates that increases in government purchases are a more potent tool than decreases in taxes for increasing aggregate demand. b. Increased government spending on "shovel-ready" projects can be helpful to boost aggregate demand. c. Increases in government spending offer a greater "bang for the buck" than decreases in taxes. d. When the government gives a dollar in tax cuts to a household, that dollar immediately and fully adds to aggregate demand.