If large fixed costs result in ATC falling as output increases and this occurs over the relevant range of output, this industry is a:
A. natural monopoly.
B. network externality.
C. profit maximizer.
D. constant-cost industry.
A. natural monopoly.
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The figure above shows the market for coffee. If one firm owns all the coffee outlets and sells 10 million pounds of coffee a month
A) the market is efficient because the marginal social benefit from coffee exceeds its marginal social cost. B) the market is efficient because the total social benefit from coffee exceed the total social cost. C) there is a deadweight loss because the marginal social benefit from the last pound of coffee exceeds its marginal social cost. D) there is a deadweight loss because the marginal social cost of the last pound of coffee exceeds its marginal social benefit.
In the model of monopolistic competition, if firms have ________ average cost curves, then opening trade will cause ________ firms to ________ the industry
A) different; less efficient; exit B) different; more efficient; enter C) symmetric; less efficient; exit D) symmetric; more efficient; enter E) symmetric; less efficient; enter
How is the dividing line between poverty and nonpoverty measured? Does this method overstate the degree of poverty?
A neighborhood voted to develop a vacant lot into a vegetable garden. All of the neighbors worked the land and sowed the seeds. A few neighbors picked and ate the produce before the other neighbors had a chance. Which of the following could solve this example of the Tragedy of the Commons?
a. The neighborhood divides the lot into equal size plots and each family can plant and harvest only on their plot. b. The neighborhood continues to work the land and sow the seeds as a group, but sells all of the produce to willing buyers and reinvests the proceeds into the garden for the next year. c. The neighborhood decides to stop gardening on this land because there is no equitable way to allocate the produce. d. Both a and b are possible solutions to this example of the Tragedy of the Commons