When will new firms enter a perfectly competitive market? When does entry stop?
What will be an ideal response?
New firms will enter a perfectly competitive market as long as the existing firms are making an economic profit. Essentially the new firms enter in order to make an economic profit themselves. Entry will stop when it is no longer possible to make an economic profit, which occurs when the existing firms are making zero economic profit.
Economics
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If the actual interest rate in the money market is higher than the equilibrium interest rate, there would be an excess supply of money
Indicate whether the statement is true or false
Economics
The Pareto optimality concept is _____
a. equivalent to the concept of economic efficiency b. equivalent to Pareto superiority c. equivalent to utilitarianism d. equivalent to cost-benefit analysis
Economics