Which of the following is not considered a barrier to entry into a monopoly market?
A. an new product-type is offered.
B. ownership of a key resource.
C. government intervention.
D. having a natural monopoly.
Answer: A
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The table above gives the total revenue and total cost for a perfectly competitive firm producing chocolate chip cookies. If the firm is producing 1 pound of cookies, to maximize its profit it will
A) increase its output. B) decrease its output. C) continue producing 1 pound of cookies. D) shut down.
At the current price of a good, Al's consumer surplus equals 15, and Ben's consumer surplus equals 15. By charging a two-part tariff, a monopolist could increase his profit by
A) 8. B) 16. C) 15. D) 30.
The economic functions of government include
A) determining prices. B) setting wages in the public sector. C) protecting property rights. D) welfare.
When breaking up a natural monopoly is not advisable
a. it should be left alone b. government regulation should be used to set marginal revenue equal to marginal cost c. government regulation should be used to set price equal to marginal revenue d. government regulation should be used to set marginal cost equal to long-run average total cost. e. public ownership and operation may improve efficiency