Under what conditions can a monopolist have potentially lower costs and possibly charge a lower price than would exist if the market were competitive?
a. when the monopolist operates on the inelastic portion of the demand curve
b. when the monopolist is a profit maximizer rather than a revenue maximizer
c. when substantial diseconomies of scale are present
d. when substantial economies of scale are present
D
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Suppose the president is successful in passing a $10 billion tax increase. Assume that taxes are fixed, the economy is closed, and the marginal propensity to consume is 0.8. What happens to equilibrium GDP?
A) There is a $50 billion increase in equilibrium GDP. B) There is a $40 billion increase in equilibrium GDP. C) There is a $40 billion decrease in equilibrium GDP. D) There is a $50 billion decrease in equilibrium GDP.
An increase in the liquidity of corporate bonds will ________ the price of corporate bonds and ________ the yield of Treasury bonds, everything else held constant
A) increase; increase B) reduce; reduce C) increase; reduce D) reduce; increase
The monopolist is always constrained by:
A. the amount demanders are willing to buy at any given price. B. his production capacity. C. the barriers to entry. D. government regulation.
A situation in which society may not be able to rank its preferences consistently through paired-choice majority voting is:
A. The fallacy of limited decisions B. The paradox of voting C. The median-voter model D. Political logrolling