What is true in a market characterized by a natural monopoly?
A. The firm is always extremely large
B. The existence of economies of scale over the entire market demand
C. The size of the firm’s profits
D. The amount of innovation carried out by the firm
Answer: B
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If the current account is a deficit of 25 then
(a) the capital account is a surplus of 25. (b) the cash account is a surplus of 25. (c) the capital account is a surplus of 25 if the cash account is zero. (d) the cash account is a deficit of 25
The FDIC handles most bank failures by the purchase and assumption method because
A) the existence of uninsured deposits (over $100,000 ) makes runs and panics possible. B) it allows the FDIC to avoid paying off large deposits when a bank fails. C) most banks have become too big for the FDIC to allow them to fail. D) it allows the FDIC to write checks legally to pay all deposits, even those over $100,000.
The use of "most-favored-customer" clauses is an example of
A) incenting members to maintain the cartel, because if they lower the price for one customer, they have to lower it for previous customers as well. B) incenting members to maintain the cartel, because if they raise the price for one customer, they have to raise it for previous customers as well. C) giving customers special perks for purchasing goods from members of the cartel. D) selling higher quality goods and services to favorite customers.
Changing prices cause changes in the supply of a good and therefore result in movements along a given supply curve
a. True b. False Indicate whether the statement is true or false