A price restriction that tells suppliers the minimum price they can sell their goods for is also known as
A) a price ceiling.
B) a quota.
C) a price floor.
D) deadweight loss.
A
You might also like to view...
What is meant by constant returns to scale?
What will be an ideal response?
A monopolist faces the (inverse) demand for its product: p = a - bQ. The monopolist has a marginal cost given by c and a fixed cost given by F
a. Assume that F is sufficiently small such that the monopolist produces a strictly positive level of output. What is the profit-maximizing price and quantity? b. Compute the maximum profit for the monopolist. c. For what values of F will the monopolist earn negative profit?
You have collected data for a cross-section of countries in two time periods, 1960 and 1997, say
Your task is to find the determinants for the Wealth of a Nation (per capita income) and you believe that there are three major determinants: investment in physical capital in both time periods (X1,T and X1,0), investment in human capital or education (X2,T and X2,0), and per capita income in the initial period (Y0). You run the following regression: ln(YT) = ?0 + ?1X1,T + ?2X1,0 + ?3X2,T + ?4X1,0 + ln(Y0) + uT One of your peers suggests that instead, you should run the growth rate in per capita income over the two periods on the change in physical and human capital. For those results to be a parsimonious presentation of your initial regression, what three restrictions would have to hold? How would you test for these? The same person also points out to you that the intercept vanishes in equations where the data is differenced. Is that true? What will be an ideal response?
Independent workers face difficulties in arriving at choices for all of the following reasons, EXCEPT:
a. difference in investment responsibilities for their equipment. b. difference in attitudes toward risk. c. difference of opinion regarding a new strategy's probability of success. d. difference in their transaction costs.