Suppose both a monopolist and a perfectly competitive firm charge a price corresponding to the quantity at the intersection of the marginal cost and marginal revenue curves. If this price is between each firm's average variable cost and average total cost curves,
A. the perfectly competitive firm will continue to operate in the short run but the monopolist will shut down.
B. both firms will continue to operate in the short run.
C. both firms will shut down in the short run.
D. the perfectly competitive firm will continue to operate in spite of the loss but the monopolist will earn a profit.
Answer: B
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Which of the following statements is true?
A) The demographic transition of the 19th century led to a decrease in life expectancy across the Western world. B) Until the demographic transition in the 19th century, they were recurrent Malthusian cycles. C) The demographic transition of the 19th century led to an increase in fertility across the Western world. D) After the demographic transition in the 19th century, they were recurrent Malthusian cycles.
Assume that when price is $20, quantity demanded is 9 units, and when price is $19, quantity demanded is 10 units. Based on this information, we can conclude that over the price range from $19 to $20, demand is price:
A) elastic. B) unit elastic. C) inelastic. D) cannot be determined.
Alcoa had a monopoly in the U.S. aluminum market from the late nineteenth century until the end of World War II. Which barrier to entry was the source of Alcoa's monopoly power?
a. Ownership of a vital resource. b. Government franchises and licenses. c. Patents and copyrights. d. Economies of scale.
The price ceiling that the federal government placed on human organs caused
A. A shortage. B. An increase in supply. C. A surplus. D. An increase in demand.