Author Question: Product differentiation in monopolistically competitive markets implies that: a. firms make ... (Read 31 times)

abc · **on:** Jun 30, 2018

Product differentiation in monopolistically competitive markets implies that:
a. firms make economic profits in the long run.
b. firms will produce at the minimum of the average total cost curve in the long run.
c. individual firms face downward-sloping demand curves.
d. firms are certain to earn economic profits in the short run.

Question 2

Interest rate parity can be summarized by which of the following equilibrium conditions?
a. The foreign interest rate must equal the domestic interest rate plus the expected inflation.
b. The foreign interest rate must equal the domestic interest rate.
c. The foreign interest rate must equal the expected change in the exchange rate.
d. The domestic interest rate must equal the foreign interest rate plus the expected change in exchange rate.
e. The domestic interest rate must equal the foreign interest rate minus any expected inflation.