The advantages of maintaining monopolies:
A. always outweighs the total welfare costs due to lost surplus.
B. sometimes outweighs the total welfare costs due to lost surplus.
C. never outweighs the total welfare costs due to lost surplus.
D. is a normative argument that has no right answer.
D. is a normative argument that has no right answer.
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Assume that the dollar price of a basket of goods in the U.S. is $4 and the Indian price for the same basket is 200 rupees. On the other hand, the dollar price of the Indian basket is $20
Given this information, the Indian price for the Indian basket will be: A) $1,200. B) $1,000. C) $200. D) $5.
The issue of fairness versus efficiency arises
a. only in a command economy. b. only in a market economy. c. in neither a command nor a market economy. d. in both a command and a market economy.
The Coase theorem will hold only if:
A. government will provide free mediation. B. the transactions costs are clearly identified and assigned. C. the contracts are enforceable. D. None of these statements is true.
If a good has an income elasticity of demand greater than 1, one might classify that good as
A) a necessity. B) a luxury. C) unusual. D) inelastic.