A profit maximizing monopolist sets price and output so that it always operates on the elastic portion of its straight-line demand curve when in equilibrium
a. True
b. False
Indicate whether the statement is true or false
True
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The table gives the demand and supply schedules for fireworks on the Island of Big Bang. In the past, because many deaths have resulted from accidents involving fireworks, the government has banned fireworks and is enforcing the ban
A $5 a firework penalty on buyers of fireworks and a $4 a firework penalty on sellers will reduce the number of fireworks bought to ________ a week and the price paid by buyers will be ________ a firework. A) 80; $7 B) 40; $13 C) 0; an unknown amount D) 160; $11
Productivity is ________
A) determined by central bank policy B) the combined effect of monetary and fiscal policy C) the residual component of the production function D) driven by changes in the rate of growth of output
When a moral hazard problem exists for automobile driving, the marginal cost of driving
A) is lowered, and the amount of driving done is raised above the efficient level. B) is lowered, and the amount of driving done is lowered below the efficient level. C) is raised, and the amount of driving done is raised above the efficient level. D) is raised, and the amount of driving done is lowered below the efficient level. E) is raised above the efficient level, but market forces keep the total amount of driving is kept at the efficient level.
An effective minimum wage creates a surplus of labor and increases the level of unemployment.
Answer the following statement true (T) or false (F)