Assignment:
ALL response should be at least 75 words in length. You are required to use at least your textbook as source material for your response. All sources used, including the textbook, must be referenced; paraphrased and quoted material must have accompanying citations.
1. Explain why product differentiation leads to differences between monopolistic competition and perfect competition.
2. What is the golden rule of profit maximization? Explain why the rule maximizes profits. Why are economic profits zero all along a long-run supply curve in perfect competition?
3. Discuss the types of barriers to entry, and explain whether each type is likely to provide long-term monopoly power. What are the allocative and distributive differences between monopoly and perfect competition? What causes these differences?
4. Compare and contrast perfect competition and oligopoly.
5. Perfectly competitive firms are called price takers. What does this mean? Why are they price takers?
6. If work provides disutility, why do people ever engage in either market work or nonmarket work?
7. What does it mean to say that the demand for a resource is a derived demand? Why does the supply curve of a resource slope upward?
8. What can cause the demand for a resource to shift?
9. Why does the division of resource earnings into economic rent and opportunity costs depend on the resource owner's elasticity of supply?
10. Distinguish between craft unions and industrial unions.