To maximize its profit, a monopoly should choose a price where demand is:

How will contractionary monetary policy in Japan affect the demand for the yen and the supply of the yen in the foreign exchange market?

A) The demand for the yen will fall, and the supply of the yen will fall. B) The demand for the yen will increase, and the supply of the yen will increase. C) The demand for the yen will increase, and the supply of the yen will fall. D) The demand for the yen will fall, and the supply of the yen will increase.

If firms in a monopolistically competitive industry experience short-run losses

A) some firms would like to exit the industry but find they cannot. B) firms increase prices further, until they make at least a normal return. C) firms increase advertising spending to increase demand, until they make at least a normal return. D) some firms exit the industry, causing the demand curves for the remaining firms to shift to the right until they earn a normal profit.