Comparing the monopolist to the perfect competitor,
A. only the monopolist produces where MC equals MR.
B. both have downward-sloping demand curves.
C. only the perfect competitor will make an economic profit in the long run.
D. only the monopolist will make an economic profit in the long run.
D. only the monopolist will make an economic profit in the long run.
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If concerns about mad-cow disease impose economic losses on the perfectly competitive cattle ranchers, exit by the ranchers combined with no further changes in the demand for beef will force the price of beef to
A) decrease. B) not change. C) increase. D) fluctuate, with the trend being lower prices. E) probably change, but more information about the market supply of beef is needed to answer the question.
The domestic demand curve, domestic supply curve, and world supply curves for a good are given in the above figure. All the curves are linear. Initially, the country allows imports. Then imports are banned
Calculate how consumer and producer surplus change because of the ban. Is the country better off with the ban on imports? Why?
Public goods differ from private goods in that:
a. they produce negative externalities. b. they are not scarce. c. their benefits cannot be denied to anyone. d. their consumption must be regulated by the government. e. their benefits are very narrow.
Refer to the accompanying figure. Suppose the solid line shows the current demand curve for coffee. In response to an announcement that much of next year's coffee crop has been destroyed by a storm in Brazil, you should expect:
A. neither a change in quantity demanded nor a shift in demand because next year's coffee crop will not affect the current demand for coffee. B. an increase in the quantity of coffee demanded, but no shift in the demand curve. C. the demand curve to shift to D(B) in anticipation of higher future prices. D. the demand curve to shift to D(A) in anticipation of higher future prices.