Compared to perfect competition, a monopoly in the long run
A. produces a larger output.
B. charges a higher price.
C. produces the minimum average cost.
D. All of these responses are correct.
Answer: B
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If the price elasticity of demand for pineapples is 0.75, then a 4% increase in the price of pineapples will lead to a:
A. 0.75% increase in the quantity of pineapples demanded. B. 3% decrease in the quantity of pineapples demanded. C. 0.75% decrease in the quantity of pineapples demanded. D. 3% increase in the quantity of pineapples demanded.
An import quota will
A) lead to a shift of the demand curve. B) leave the equilibrium price unchanged and increase the quantity sold. C) limit the amount of a foreign good that can be brought into the United States. D) limit the amount of a good local producers can make.
Which of the following suggests that private markets can be effective in dealing with externalities?
a. the "invisible hand" b. the law of diminishing social returns c. the Coase theorem d. technology policy
If the Fed is going to create an environment for economic progress, it should focus on
What will be an ideal response?