An increase in demand for DVD machines occurs. Which of the following statements is TRUE for individual firms that produce DVD machines?
A) The price of DVD machines will decrease leading to an increase in the demand for labor by the firm.
B) The price of DVD machines will increase leading to an increase in the demand for labor by the firm.
C) The price of DVD machines will increase leading to a decrease in demand by customers leading to a decrease in the demand for labor by the firm.
D) A change in demand at the industry level does not influence an individual firm's demand curve for labor.
Answer: B) The price of DVD machines will increase leading to an increase in the demand for labor by the firm.
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Equilibrium is reached where there is no inherent force causing quantity supplied or quantity demanded to change.
Answer the following statement true (T) or false (F)
Monopoly pricing prevents some mutually beneficial trades from taking place. These unrealized, mutually beneficial trades are
a. less of a concern for a monopoly than competitive market. b. offset by the higher profits earned by a monopolist. c. a function of the reduction in the quantity produced by a monopolist in comparison to a competitive market. d. All of the above are correct.
The accompanying figure shows the annual demand for haircuts for one person in the town of Beaumont. There are a total of 300 residents in Beaumont, each with this same demand curve. 
If the residents of Beaumont purchase a total of 1,800 haircuts each year, then the market price for a haircut must be:
A. $20. B. $30. C. $35. D. $40.
A firm that has substantial monopoly power
A. confronts a perfectly-elastic demand curve. B. can sell as much as it wants at the price it chooses. C. can strongly influence the price that it charges for its output. D. is one of only a few firms in the industry.