Platform monopolies initially make large losses because they:
A. receive subsidies from other businesses.
B. are trying to gain market share as quickly as possible.
C. have to hire high-salary tech employees.
D. receive subsidies from government.
Answer: B
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In the above figure, for a single-price monopoly the deadweight loss is equal to the area
A) abP1. B) acP2. C) bce. D) bed. E) P1beP3.
Carefully define the following terms and explain their importance to the study of economics
a. specialization b. absolute advantage c. comparative advantage d. quota e. trade adjustment assistance
Identify the correct statement about a corrective tax. a. Equilibrium occurs at a lower market price after the tax is imposed
b. The social cost curve lies below the private cost curve in the absence of the tax. c. A market becomes allocatively efficient after the tax is imposed. d. The socially optimal level of output is more than the market equilibrium output in the absence of the tax.
The effort curve is
A. S-shaped, because a small increase in the real wage will increase work effort more at an intermediate wage than at a low wage or at a high wage. B. negatively sloped, because of diminishing marginal returns to labor. C. horizontal, because work effort is independent of the real wage. D. positively sloped, because of the law of increasing cost.