Monopolistic competition is associated with
high profit margins in the long run.
increasing returns to scale.
explicit consideration at the firm level of the strategic impact of other
firms' pricing decisions.
Patterns of interregional trade are primarily determined by _ rather than
_ because factors of production are generally _.
internal economies; population;
population; external economies;
external economies; natural
If a good is labor intensive it means that the good is produced
using relatively more labor than goods that are not labor
using labor as the only input.
using more labor per unit of output than goods that are not
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Which of the following has been confirmed by empirical tests of the
All predictions of the model for a multi-product, multi-country world are
The existence of nontraded goods results in a
Size Matters: The Gravity Model (cont.)
In fact, the size of an economy is directly
related to the volume of imports and
Larger economies produce more goods and
services, so they have more to sell in the export
Larger economies generat