Which of the Following Is Consistent with a Competitive Industry

question 39

Multiple Choice

Which of the following is consistent with a competitive industry?

• A) Marginal cost pricing.
• B) High barriers to entry.
• C) Economic profit in the long run.
• D) Production and supplies are constrained.

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Definitions:

Framing Effects

The influence on decision making prompted by the way information is presented, rather than just the information itself.

Self-Serving Bias

The common human tendency to attribute positive events to one's own character but attribute negative events to external factors.

Endowment Effect

The tendency people have to place higher valuations on items they possess (are endowed with) than on identical items that they do not possess; perhaps caused by loss aversion.

Time Inconsistency

The tendency of certain conditions or decisions to change over time, especially in the context of economic planning and policy-making.