Economists tend to be concerned about entry barriers. Why are entry barriers so important?
Economists see barriers as the primary reason why monopoly and oligopoly occur. In the absence of barriers, neither type of industry could remain viable-or, in the absence of the barriers, contestable markets would give results similar to those of competition. It is barriers that lead to the undesirable consumer utility results of P > MC, and other aspects of firms which are unresponsive to consumer wishes. Finally, barriers can lead to economic profit in long-run equilibrium. However, most economists are less concerned about profits than about efficiency.
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What did Adam Smith identify as the source of the invisible hand in 1776?
A) a benevolent central government that decided was best for everyone B) an individual's concern for fellow humans C) an individual's own self-interest D) the stock market E) buyers' and suppliers' concerns to obtain and retain good reputations
Suppose that you are spending two hours a day studying economics, and your grade is 85 percent. You want a higher grade and decide to study for an extra hour a day. As a result, your grade rises to 90 percent. Your marginal benefit is the
A) 5 point increase in your grade minus the opportunity cost to you of spending the hour studying. B) extra hour per day you spend on studying. C) 5 point increase in your grade. D) three hours per day you spend on studying.
Private health insurance pays for what percentage of health care expenditures?
A. 0 B. 5 C. 40 D. 35
The number of years required for real GDP to double can be found by:
A. dividing the annual growth rate by .07. B. multiplying the annual growth rate by 70. C. dividing 70 by the annual growth rate. D. adding 14 to annual growth rate.