"Because of rent seeking, a monopoly may end up earning a normal profit." Is the previous statement correct or incorrect? Why?
What will be an ideal response?
The statement is correct. Competition among rent seekers might cause the successful person striving to create a monopoly to pay so much in order to create the monopoly that, when taking into account the cost of creating the monopoly, the person earns only a normal profit.
You might also like to view...
Briefly describe monetarism and the monetary growth rule
What will be an ideal response?
If your income is $40,000 and your income tax liability is $5,000 . your
a. marginal tax rate is 8 percent. b. average tax rate is 8 percent. c. marginal tax rate is 12.5 percent. d. average tax rate is 12.5 percent.
Which of the following is equivalent to total cost?
a) Fixed costs plus variable costs. b) Marginal costs plus implicit costs. c) Economic costs plus accounting costs. d) Variable costs plus marginal costs.
An increase in government spending will
A. increase the slope of the IS curve. B. shift the IS curve to the left. C. shift the IS curve to the right. D. shift the LM curve to the right.