Refer to Figure 6-2. The absolute value of the price elasticity of demand at points a and b is 1. What is the value of Pb?
A) $50 B) $40 C) $30 D) $20
B
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In its case against Microsoft, the government contended that Microsoft engaged in a pattern of predatory behavior designed to extend its monopoly power. This is an example of "per se illegality."
a. True b. False
A monopolist sets its price
A. below the demand curve. B. without constraints since there is no competition. C. on the demand curve, at the rate of output where marginal revenue equals marginal cost. D. at the minimum of the long-run average total cost curve.
Simple Fluff Pillows just learned it will be assessed a new state tax of two dollars for each pillow it produces. It will produce one million pillows this year. What will be the state tax revenue collected this year from Simple Fluff Pillows?
a. one million dollars b. two million dollars c. two dollars d. half a million dollars
Which of the following will cause the average cost curve of making cigarettes to shift?
A) a $5 million penalty charged to each cigarette maker B) a $1 per pack tax on cigarettes C) a $1 an hour wage increase paid to all cigarette production workers D) All of the above.