If everyone agrees that a certain economic outcome is desirable, the simplest way for government to achieve that outcome is to use
A. a market-based approach.
B. an era of deregulation.
C. a command-and-control approach.
D. a mixed economy.
Answer: C
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A natural monopoly usually arises when
A) there are diseconomies of scale in an industry. B) the government allows unrestricted access to a market. C) there are large economies of scale relative to the industry's demand. D) companies band together to form a larger company.
A change in output by one firm in an industry affects the sales of its competitors. This exemplifies ______.
a. tie-in sales b. social welfare c. perfect competition d. mutual interdependence
When the firm increases output and the costs rise disproportionately faster, then the long-run average cost curve is ________ and the firm is experiencing ________.
A. horizontal; constant returns to scale B. downward sloping; constant returns to scale C. upward sloping; diseconomies of scale D. downward sloping; economies of scale
The fact that the Phillips curve broke down during the 1970s means that aggregate demand has no effect on inflation.
Answer the following statement true (T) or false (F)