If a perfectly competitive industry becomes a monopoly and the costs do not change, which of the following allocation of costs and benefits applies?
A) The producer benefits, but consumers and society are harmed.
B) The producer and society are harmed, but consumers benefit.
C) The producer and society benefit, but consumers are harmed.
D) The producer is harmed, but consumers and society benefit.
E) The producer, consumers, and society all benefit.
A
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The marginal propensity to consume out of income
A) is larger than one. B) is equal to one. C) is smaller than one. D) varies around one.
The value of price elasticity of demand is more likely to be above 1 if:
a. consumers have a long time to adjust to a price change. b. the product is a necessity. c. demand is inelastic. d. there are few close substitutes for the product. e. total revenue declines in response to a price reduction.
The most heavily traded category of goods in the world is:
a. office and telecom equipment. b. chemicals. c. iron and steel. d. textiles. e. crude petroleum.
When the price of milk rises, there is no change in the amount of dog food purchased. This is an example of:
A. indifference trade-off between the two goods. B. the interaction between -two correlated goods. C. the value people place on dogs versus milk. D. two items that are uncorrelated.