During the 1992 presidential campaign, H. Ross Perot made much of the various "special interests" which lobby in Washington, D.C. How might an economist view this? Which specific market breakdown may occur if there is lobbying? Relate your answer to the study of monopoly and oligopoly
Lobbying may be a manifestation of rent seeking, that is, seeking a higher rate of return by restricting entry or otherwise limiting the free movement of resources in pursuit of profits. This can be an example of a government restriction serving as an entry barrier, leading to continued long-run economic profit for the resulting monopolistic or oligopolistic market structure.
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Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher
Refer to Figure 2.1. If you are producing 600 tons of agricultural products per year, what is the maximum amount of manufactured products you can produce per year?
A) 300 tons B) 500 tons C) 600 tons D) 700 tons
According to Walton and Rockoff, the primary reason the Federal government failed to build an adequate highway system before the Civil War was
a. the technology was not available. b. the canal craze diverted attention. c. rivalries among different sections of the country stalled legislation. d. the teachings of Adam Smith were taken too literally.
For a perfect competitor, price equals
A. marginal revenue only. B. neither marginal revenue nor average revenue. C. both average revenue and marginal revenue. D. average revenue only.