Which of the following is a major criticism of a monopoly as a cause of allocative inefficiency?
a. A monopolist fails to expand output to the level where the consumers' evaluation of an additional unit is just equal to its opportunity cost
b. A monopolist has no incentive to produce efficiently, because even if it pays no attention to the costs of production, it will be guaranteed an economic profit
c. A monopolist will always make profits therefore providing an incentive to keep prices at the level that maximizes consumer surplus
d. A monopolist has an advantage because it can purchase the resources in a competitive market
e. Consumer surplus would no longer be equal to producer surplus
A
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A characteristic of stock prices is that ________
A) they tend to go up on the upswing of the cycle B) they tend to go down on the downswing of the cycle C) they are a leading indicator D) all of the above E) none of the above
Which statement best defines efficiency?
a. when it becomes possible to benefit at least one party without imposing costs on others b. when it is impossible to improve the situation of one party without imposing a cost on another c. the amount that a seller is paid for a good minus the seller’s actual cost d. the amount that individuals would have been willing to pay, minus the amount that they actually paid
The difference between short-run and long-run cost is that in the short run,
a. there are shortages of labor that can restrict output b. only labor can be changed to increase or decrease production c. fixed factors of production have already been chosen d. the market-day supply limits the amount by which producers can change production e. all factors of production are variable
When a country saves a larger portion of its GDP than it did before, it will have
a. more capital and higher productivity. b. more capital and lower productivity. c. less capital and higher productivity. d. less capital and lower productivity.