ECO Answers - 4. According to the principle of diminishing...

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4. According to the principle of diminishing returns, an additional worker decreases total output (Points :1) True False 5. To compute the price elasticity of demand, we divide the percentage change in price by the percentage change in quantity demanded (Points :1) True False 6. If the price elasticity of demand is 0.60, a 10 percent increase in price will decrease the quantity demanded by 6 percent. (Points :1) True False 9. Which of the following is not a characteristic of a monopolistically competitive market? (Points :1) Firms must take the market price as given There are no artificial barriers to entry. Firms sell differentiated products. There are many firms. 10. Which of the following is not a characteristic of a monopolistically competitive market? (Points :1) Firms have some control over price. Firms hold patents on their products. There are no artificial barriers to entry. The products that firms sell are slightly different.
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11. Which of the following is not a characteristic of a monopolistically competitive market? (Points :1) There are many firms. There are substantial barriers to entry. Firms have control over price. Firms sell differentiated products 13. When firms cooperate with each other rather than compete: (Points :1) both consumers and firms end up better off. they will agree to set low prices to help each other out. the firms will end up better off (they will act as a monopoly).
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This note was uploaded on 05/10/2011 for the course ECO 212 taught by Professor Emil during the Spring '11 term at Aberystwyth University.

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ECO Answers - 4. According to the principle of diminishing...

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