Suppose a firm is a natural monopoly. Then, until the long-run average cost curve crosses the demand curve, as the quantity increases the long-run average costs
A) increase.
B) decrease.
C) decrease and then increase.
D) increase and then decrease.
B
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Refer to Figure 7-3. What is the reduction in value of consumer surplus after the imposition of the quota?
A) $8 million B) $26.25 million C) $27.75 million D) $30 million
In Lee Benham's 1972 article examining the impact of advertising on the average price paid for a pair of eyeglasses, Benham found that
a. the average price paid for eyeglasses was nearly 20% higher in the states that did not restrict advertising. b. the average price paid for eyeglasses was nearly 20% lower in the states that did not restrict advertising. c. there was no difference in the average price paid between states that restricted advertising and those that did not. d. the average price paid for eyeglasses was almost 5 times higher in the states that did not restrict advertising.
Which of the following is most likely to encourage economic growth?
a. stable private property rights b. an extensive welfare system c. frequent military take-overs of the government d. a shrinking labor force e. a fixed capital stock
Refer to Figure 4-7. The movement from Db to Da in the market for potato chips could be caused by a(n)
a. Decrease in the price of potato chips.
b. Decrease in income, assuming that potato chips are a normal good.
c. Announcement by the FDA that potato chips lower cholesterol.
d. Increase in the price of a pretzel.