Which of the following is NOT a barrier to entry that would allow a monopolist to keep potential competitors out of its market?
A) Significant economies of scale exist.
B) The market price of the product is too high.
C) The firm has a patent on the good or control over some resource required for the production of the good.
D) The firm has government authorization to be a monopoly.
Answer: B
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Refer to Table 14-3. Consider the above simplified balance sheet for a bank. If the required reserve ratio is 10 percent, the bank can make a maximum loan of
A) $2,000. B) $5,000. C) $6,300. D) $45,000.
Refer to Figure 13-16. Figure 13-16 depicts a monopolistically competitive barber shop. Use the diagram to answer the following questions
a. Suppose the average variable cost of production is $15 when output equals 110 haircuts and $15.25 when output equals 140 haircuts. If the firm wants to maximize its profit or minimize its losses, how many haircuts will it produce and what price should it charge? Explain your answer. b. Calculate the firm's profit or loss. c. What is likely to happen in this industry over time as it moves to its new long-run equilibrium? d. Suppose the barber shop depicted in the diagram remains in the industry. Is this barber shop likely to produce this same quantity of haircuts as in part (a) in the long run?
A firm that can borrow from a bank any amount it wishes up to a certain limit, and at any time up to a certain date, is said to have a
A) repurchase agreement. B) trade credit. C) a line of credit. D) internal financing.
If savings does not depend upon the interest rate, then
a. the IS curve is vertical. b. the IS curve is horizontal. c. the LM curve is horizontal. d. the IS curve is still downward sloping. e. none of the above.