For years, economists believed that market structure explained the ability of some firms to earn economic profits. Today, economists and business strategists put greater emphasis on
A) the number of countries in which a firm conducts business and the number of employees the firm has in each country.
B) the number of years a firm has been in business and the average price of the products sold by the firm.
C) the characteristics of individual firms and the strategies their managements use to continue to earn economic profits.
D) the size of a firm relative to the industry average and the number of firms in the domestic industry.
C
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Technological change that makes it easier to produce in a "cleaner" fashion would cause
A) the marginal cost curve of pollution abatement to shift left, increasing the degree of air quality. B) the marginal cost curve of pollution abatement to shift right, increasing the degree of air quality. C) the marginal benefit curve of pollution abatement to shift right, increasing the degree of air quality. D) the marginal benefit curve of pollution abatement to shift left, increasing the degree of air quality.
A market equilibrium might not maximize total economic surplus because:
A. in a market equilibrium individuals do not exploit all opportunities for individual gain. B. in a market equilibrium individuals do not act rationally. C. efficiency is not an important social goal. D. sometimes goods entail costs and benefits that do not fall on buyers and sellers.