Which of the following is most likely the most beneficial form of monopoly advantage?
A) better production methods
B) input hoarding
C) decreasing returns to scale
D) government protection
A
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In perfect competition, each additional unit of output that a firm sells will yield a marginal revenue that is
A. less than price. B. equal to price. C. equal to average total cost. D. greater than price.
A supply schedule is a table that reports:
A) the expected excess supply in the market at different prices. B) the profits earned by producers at different levels of production. C) the different quantities of a good that producers are willing to sell at different prices. D) the different quantities of a good that producers are willing to sell at different income levels.
The local bakery makes such great cinnamon rolls that consumers do not respond much at all to a change in the price. If the owner is only interested in increasing revenue, she should
a. lower the price of the cinnamon rolls. b. leave the price of the cinnamon rolls unchanged. c. raise the price of the cinnamon rolls. d. reduce costs.
Related to the Economics in Practice on p. 318. Producers of Honest Tea add less sugar to their tea than the amount that would maximize consumer's total utility from sugar because
A. the marginal utility to the consumer from adding more sugar is very low (near zero) while the marginal health cost (added calories) is quite high. B. the financial cost of the additional sugar is less than the additional revenue that the firm would earn. C. producers are attempting to differentiate their product from the very sweet Snapple. D. producers are attempting to market their product to diabetics.