If a regulator forced a natural monopolist to set P = MC
A. the monopolist would break even.
B. the monopolist would suffer economic losses.
C. the monopolist would earn economic profits.
D. the monopolist would earn monopolistic profits.
Answer: B
You might also like to view...
The above table shows the short-run total product schedule for the campus book store. What is the marginal product (MP) of going from 5 to 6 employees at the book store?
A) 83 books sold B) 13.83 books sold C) 10 books sold D) between 11 and 14 books sold
Suppose that changes in the interest rate have absolutely no effect on the demand for money. The resulting ________ LM curve causes monetary policy to have ________ effect in changing income
A) horizontal, no B) horizontal, an unusually strong C) vertical, no D) vertical, an unusually strong
After a massive promotional campaign of Justin Bieber's latest music album, the producers decided to raise the prices on the album. This implies that the producers expect the promotion to have made the demand for the album
a. More elastic b. Unitary elastic c. Perfectly elastic d. More inelastic
Assume sticky prices and given expectations of future exchange rates, what is the immediate effect on the exchange rate of the U.S. dollar if there is a temporary increase in the quantity of U.S. dollars?
a. U.S. nominal and real returns rates decline while euro rates hold steady, and the U.S. dollar depreciates against the euro. b. U.S. nominal returns rise, U.S. real returns fall, euro rates rise, and the U.S. dollar appreciates against the euro. c. U.S. nominal returns fall, U.S. real returns rise, euro rates fall, and the U.S. dollar appreciates against the euro. d. U.S. dollar returns and euro returns both rise, leaving the exchange rate unchanged.