If a market is close to perfect competition, profits may be
A. so low that companies have no incentive to spend money on long-run research.
B. so high that companies have no incentive to spend money on long-run research.
C. so high that companies are not willing to risk any extra money on long-run research.
D. so low that companies do not have enough extra money to spend on long-run research.
Answer: D
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An increase in foreign investment in Brazil's mining industry will increase the capital stock in Brazil. Holding labor and total factor productivity constant, continued increases in the capital stock will lead to
A) larger and larger increases in real GDP. B) smaller and smaller increases in real GDP. C) larger and larger decreases in real GDP. D) small increases, followed by small decreases, in real GDP.
Table 3 Hometown Bank Assets Liabilities Reserves $25,000 Deposits $150,000 Loans $125,000 Refer to Table 3. If the reserve requirement is 25 percent, this bank
A. has $10,000 of excess reserves. B. needs $12,500 more reserves to meet its reserve requirements. C. needs $2,500 more reserves to meet its reserve requirements. D. just meets its reserve requirement.