What is the shape of a monopolist's demand curve and marginal revenue curve?
What will be an ideal response?
A monopolist's demand curve and marginal revenue curve are both downward sloping. The two curves begin at the same point on the price axis because the price of the first unit is the marginal revenue from selling the first unit. Thereafter, marginal revenue is below price because the monopolist must lower the price of all units of the good that it sells in order to sell additional units of the good.
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Use the following graph to answer the next question.
The perfectly competitive firm's supply curve is the
A. MC curve at and above G. B. MC curve at and above F. C. MC curve at and above H. D. MC curve at and above J.
Recall the Application. In response to the financial crisis, the Fed implemented a new policy in which it began to pay interest on deposits held at the Fed
This move would ________ deposits held at the Fed and ________ the Fed's ability to make loans. A) increase; decrease B) decrease; decrease C) increase; increase D) decrease; increase
Lora earns an income of $7,500 per month. Under the federal income tax system, the first $6,000 she earns is taxed at 10% and the remaining income is taxed at 20%. Then the average tax paid by Lora equals _____
a. 25 percent b. 12 percent c. 30 percent d. 20 percent
The term "gross domestic purchases" refers to
A. the amount spent only by U.S. consumers on final goods and services. B. the amount spent only by government on final goods and services. C. the amount spent by U.S. consumers, businesses, and government on final goods and services. D. the amount spent only by businesses on final goods and services.