Which of the following is not true in the long run under perfect competition?
a. There is no incentive for firms to enter or exit the industry.
b. Economic profit is zero
c. Long-run marginal cost is minimized.
d. Long-run average total cost is minimized.
c
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Intra-industry trade will tend to dominate trade flows when which of the following exists?
A) small differences between relative country factor availabilities B) large differences between relative country factor availabilities C) homogeneous products that cannot be differentiated D) constant cost industries E) uneven distribution of abundant resources between two countries
One drawback to industrial policy is that
a. technology spillovers are too expensive to control. b. measuring the size of spillovers from different markets is difficult. c. spillovers often occur in industries that produce undesirable products for society. d. positive side effects are often outweighed by negative side effects.