Reduce the production cost during the economic recession

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1. Under what conditions can we be sure that perfect competition leads to a more efficient use of resources tan monopoly? How prevalent are these conditions in the real world?

2. As an employer wants to reduce the production cost during the economic recession, he/she could choose to (1) lay off some workers without changing wages or (2) keep all workers but cut wages for all. Which method would you choose? Why?

Reference no: EM131004778

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