Identify two ways by which the government controls monopolies?
What will be an ideal response?
The government control monopolies by enforcing antitrust laws and through economic regulation of natural monopolies.
You might also like to view...
Two software firms have developed an identical new software application. They are debating whether to give the new app away free and then sell add-ons or sell the application at $30 a copy
The payoff matrix is above and the payoffs are profits in millions of dollars. What is the Nash equilibrium of the game? A) Both Firm 1 and 2 will sell the software application at $30 a copy. B) Both Firm 1 and 2 will give the software application away free. C) Firm 1 will give the application away free and Firm 2 will sell it at $30. D) There is no Nash equilibrium to this game.
Collusion:
A. occurs only when no dominant strategy is present. B. is a cooperative outcome between competitors. C. is observed, but economists cannot theoretically model it. D. is a theoretical concept that is rarely observed.
Using your own words, describe the law of increasing opportunity costs. Be sure to explain why this phenomenon occurs and how it helps to contribute to the shape of the production possibilities frontier
The best output or the optimal production of the nation is:
A. A combination of products at the midpoint of the production possibilities curve B. A combination of products at the two endpoints of the production possibilities curve C. Determined by equalizing the marginal benefits and marginal costs of each product D. The production combination where the opportunity costs are minimized