A picture-frame company operates in a monopolistically competitive market. Its short- run equilibrium price is $80 and its ATC is $65 . It sells 100 picture frames a week. Ignoring for now its long-run position, in the short run,
a. the firm makes zero economic profit, zero accounting profit, but $1,500 normal profit
b. other picture-frame companies will leave the market because it knows new firms will enter to drive price and economic profit down
c. the firm makes an $80,000 accounting profit
d. the firm makes an economic profit of $1,500
e. the market demand curve will shift to the left as more firms enter the market
D
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In the neocolonial dependence model, the world can be thought of as divided into
a. absolutionists and neorevisionists. b. the "north" and the "south." c. the "First World," "Second World," and "Third World." d. producers and consumers. e. the "center" and the "periphery."
What are the factors that affect GDP according to the aggregate production function used by Solow?
What will be an ideal response?