Which of the following is true for both perfect and monopolistic competition?
A) Firms produce a differentiated product.
B) Firms face a downward sloping demand curve.
C) Firms produce a homogeneous product.
D) There is freedom of entry and exit in the long run.
D
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In the spring of 1994, Northwest Airlines took the independent action of reducing fares on its flights. Other competing airlines quickly matched the fare cuts. These actions might be interpreted as:
A) a noncooperative game. B) a cooperative game. C) a constant sum game. D) a competitive game.
A sudden increase in the demand for newly built homes will
a. decrease the demand for lumber, bricks, and steel. b. decrease the demand for construction workers and architects. c. increase the marginal product of workers in the construction industry. d. increase the demand for construction workers and architects.