What is defined as the ability of a firm to earn high profits by raising and keeping the prices of its products substantially above the levels at which those products would be priced in competitive markets?
A. Economies of scope
B. Tacit collusion
C. Monopoly power
D. Perfect competition
Answer: C
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In the long run, a monopolistically competitive firm has market power but earns no profit.
Indicate whether the statement is true or false.
Use the following two statements to answer this question:
I. Economic theories are developed to explain observed phenomena by deducing from a set of basic rules and assumptions. II. Economic theories use value judgments to determine which people ought to pay more taxes. A. Both I and II are false. B. I is false, and II is true. C. I is true, and II is false. D. Both I and II are true.
Suppose that from a new checkable deposit, First National Bank holds two million dollars in vault cash, nine million dollars in excess reserves, and faces a required reserve ratio of ten percent
Given this information, we can say First National Bank has ________ million dollars in required reserves. A) one B) two C) eight D) ten
Why are externalities associated with common property rather than private property?
What will be an ideal response?