Compared to perfect competition, monopoly in the long run
A. restricts output.
B. charges a higher price.
C. produces at less than minimum average cost.
D. All of these responses are correct.
Answer: D
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When a grocery store offers discount coupons in Sunday papers, it is trying to
a. Price discriminate b. Undercut its competition c. Reward the frequent readers d. Provide a social service
If a firm in a monopolistically competitive market has a demand curve shifting to the right, it could be that:
A. negative economic profits are being earned. B. firms are leaving the market. C. the selling price is less than the average total cost of the firm. D. All of these statements are true.
If an economy produces 5,000 units of output with a price level of $1 and with a velocity of money of 4, we know that the money supply must be:
A. $4,000. B. $1,250. C. $2,500. D. $5,000.
Which of the following will make it more difficult for the United States to control the growth of the federal debt in the decade ahead?
a. Debt financing makes it possible for elected political officials to provide voters with highly visible current benefits without having to impose visible current cost in the form of higher taxes. b. The movement of the large baby-boom generation into the retirement phase of life will make it more difficult to control federal spending. c. The recent growth of the federal debt as a share of GDP will mean higher interest costs in the future. d. All of the above.