In an industry characterized by a natural monopoly, which of the following characteristics will be observed?
a. The long-run average cost curve will be upward sloping.
b. The market price of the product will be very low.
c. Competition is both impossible and inefficient.
d. Number of producers operating in this market will be low.
C
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Assuming all else equal, if a household is optimistic about future income, it is likely to cause:
A) the current credit supply curve of the household to shift to the left. B) an upward movement along the current credit supply curve of the household. C) the current credit supply curve of the household to shift to the right. D) a downward movement along the current credit supply curve of the household.
The long-run Phillips curve is a
A) straight line with a 45 degree slope showing the long-run relationship between the inflation rate and the expected inflation rate. B) vertical line that shows the relationship between inflation and unemployment when the economy is at full employment. C) vertical line indicating a positive relationship between inflation and unemployment. D) horizontal line indicating a positive relationship between inflation and unemployment. E) horizontal line that shows the relationship between inflation and unemployment when the economy is at full employment.
Which of the following is true regarding this statement? "The president's decision to spend more money on national defense is smart."
A) This is a normative statement. B) The federal government does not face scarcity. C) This topic would be studied in microeconomics. D) Social interest must always be more important than self-interest. E) Ceteris paribus does not apply to the government.
Apart from the United States, in countries where central bank board members serve fixed terms of office,
A) none have terms as long as fourteen years. B) many serve for life or good behavior. C) all have terms longer than fourteen years. D) the head of the central bank rarely has a term longer than one year.