To be able to engage in profit-maximizing price searching, a monopoly firm must be able to
A. induce the entry of other firms into the market for its product.
B. always earn zero economic profits.
C. prevent the entry of other firms into the market for its product.
D. avoid earning negative economic profits in the short run.
Answer: C
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The place or point where independent systems or diverse groups interact is called the:
a. Interface b. Seam c. Subsystem d. Boundary
Criticisms of the Robinson-Patman act
a. It can reduces consumer surplus b. It can reduces producer surplus c. It can creates inefficiency through unconsummated transactions d. All of the above
Assume that an individual consumes only hotdogs and colas and that the last hotdog consumed yields 15 utils and the last cola 10 utils. If the price of a hotdog is $1 and the price of a cola is $.50, we can conclude that the:
a. consumer should consume more hotdogs and less cola. b. price of hotdogs is too high. c. consumer should consume fewer hotdogs and more cola. d. consumer is in equilibrium.
If "an apple a day keeps the doctor away" and you are only interested in keeping the doctor away—which you value at 100 utils—what is the total utility you derive consuming 2 apples and what is the marginal utility of the second apple?
a. 200; 100 b. 100; 200 c. zero; 100 d. 100; zero e. 200; zero