If the government attempts to force a natural monopoly to charge a price equal to marginal cost,
A) the natural monopoly will shut down.
B) the natural monopoly will still make high profits.
C) the natural monopoly's marginal cost curve will shift up.
D) total welfare is maximized.
A
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In the economic way of thinking, the right to coerce adults is
A) immoral. B) a property right. C) the most efficient way for management to control labor. D) necessarily antithetical to a free and open society. E) good because it's rooted in the Old Testament.
When the economy slips into a recession, normally the demand for bonds ________, the supply of bonds ________, and the interest rate ________, everything else held constant
A) increases; increases; rises B) decreases; decreases; falls C) increases; decreases; falls D) decreases; increases; rises
Assuming the demand for their products is inelastic, farmers (as a group) have an incentive to
A) increase the supply of what they sell. B) agree among themselves to decrease the supply of what they sell. C) spend at least 10 percent of their budgets to advertise their products. D) b and c E) a and c
What would most likely happen if Moe’s were to add a seventh worker?
a. Fixed costs would increase.
b. The marginal product of labor would improve.
c. Variable costs would decrease.
d. Bagel output would see little change.