Most local phone companies
a. face a horizontal demand curve
b. are regulated
c. are called public utilities
d. have tremendous economies of scale
e. are natural monopolies
E
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Monopolistic competition is judged to be economically inefficient because
A) the price is greater than marginal cost. B) firms earn zero economic profit in the long run. C) marginal revenue equals marginal cost. D) firms have deficient capacity in the long run. E) firms earn an economic profit in the long run.
Ceteris Paribus, if current output has fallen below potential ________
A) a positive inflation gap will ensue B) it is likely that the equilibrium real rate has fallen below the policy rate C) a negative unemployment gap will ensue D) it is likely that the equilibrium real rate has risen above the policy rate E) none of the above
Successful export-led growth policy entails:
A. choosing the "right" industries to invest in. B. blocking the "right" industries from importing to domestic markets. C. choosing the "right" incentives to encourage exports. D. choosing the "right" disincentives to reduce imports.
If the Fed was to use all of its three most common tools to increase the money supply, it would:
a. buy bonds, reduce the discount rate, and reduce reserve requirements. b. sell bonds, reduce the discount rate, and reduce reserve requirements. c. sell bonds, reduce the discount rate, and increase reserve requirements. d. sell bonds, increase the discount rate, and increase reserve requirements.