Firms make decisions with the goal of maximizing total revenue.
Answer the following statement true (T) or false (F)
False
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Which of the following is a problem that arises when regulations force "natural monopolies," like electric utilities, to charge a price that is equal to their marginal cost (MC)?
a. This price will force the firms out of business in the long run. b. The firms have an incentive to pad their fixed costs. c. When price is equal to MC, new firms will enter the industry and drive up the costs of production. d. Both b and c are correct.
If the production of a good generates a detrimental externality, then at that level of production of the good under perfect competition,
A. MSC > P. B. MPC > MSC. C. P > MU. D. MPC > P.
Suppose Jordan and Lee are trying to decide what to do on a Friday. Jordan would prefer to see a comedy while Lee would prefer to see a documentary. One documentary and one comedy are showing at the local cinema. The payoffs they receive from seeing the films either together or separately are shown in the payoff matrix below. Both Jordan and Lee know the information contained in the payoff matrix. They purchase their tickets simultaneously, ignorant of the other's choice. 
This game:
A. is not a prisoner's dilemma. B. is a prisoner's dilemma. C. has no Nash equilibrium. D. is an ultimatum bargaining game.
Assuming the total population is 200 million, the labor force is 100 million, and 92 million workers are employed, the unemployment rate is:
A. 10 percent. B. 4 percent. C. 6 percent. D. 8 percent.