Use the following graph to answer the next question.
If the government regulated the pure monopoly and made it set a normal profit price, what price and quantity of output levels would we observe in the short run?
A. P1 and Q1
B. P2 and Q3
C. P3 and Q2
D. P4 and Q1
Answer: C
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Which of the following would indicate that a tax is regressive?
a. High-income people pay $5,000 . low-income people pay $2,000. b. High-income and low-income people pay $200 each. c. High-income people pay 20 percent of their income in taxes; low-income people pay 10 percent. d. Both high-income and low-income people pay 10 percent of their income in taxes. e. Low-income people are exempt from the tax.
Seller A, has an upward-sloping supply curve, and is willing to supply 400 units of a commodity at a price of $5 per unit. Seller A is now willing to supply 500 units at a price of $5 per unit. Evidently, seller A has experienced a(n):
a. increase in supply. b. decrease in supply. c. increase in quantity supplied. d. decrease in the quantity supplied. e. decrease in demand.
Which of the following are likely to be studied in a microeconomics course?
a. choices made by individual consumers b. the causes of inflation c. how the economy's total output is measured d. how an increase in government spending affects the level of unemployment
Which of the following firms faces monopolistic competition?
a. A poultry farm selling eggs to different bakeries b. A fashion store selling clothes at an up-scale boutique c. A fruit-bowl shop at a local market d. A movie hall selling tickets in advance for an upcoming blockbuster