If an industry realizes significant economies of scale relative to the size of the market, it is most efficient for there to be a single firm in the industry.
Answer the following statement true (T) or false (F)
True
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If the price of a burger decreases by 5 percent and as a result the quantity of burgers demanded increases by 8 percent, the price elasticity of demand equals
A) 0.60. B) 0.40. C) 1.60. D) 0.625.
In events leading to the housing bubble, investment banks on Wall Street made money through the housing market by:
A. buying as many loans as possible to create mortgage-backed securities. B. relying on banks to sell as few high-risk mortgages as possible. C. ensuring local banks were making good loans. D. offering low interest loans to those with very good credit.
If the marginal propensity to consumer is 0.8, the spending multiplier must be:
A. 5 B. 2 C. 1.2 D. 1.8
Which of the following is a form of a direct tax?
a. Personal income tax b. Sales tax c. Excise duty d. Import tariff e. Value-added tax