In a monopoly, the market demand curve is
A. the summation of all the individual firm's cost curves.
B. the same as the demand curve facing the firm.
C. the marginal cost curve above minimum average variable cost.
D. nonexistent.
Answer: B
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Suppose Sally buys a Volvo because they are safe and, as a result, drives faster and pays less attention to other cars on the road. This is an example of
a. the winner's curse b. a positive externality c. irrational behavior d. moral hazard e. adverse selection
When pricing is used to limit entry, it is often described as
A) effective. B) predatory. C) exclusive. D) aggressive.
How much has government spending as a percentage of GDP been in recent decades?
a. 2 percent b. 10 percent c. 20 percent d. 35 percent
Capital owners are compensated according to the value of the marginal product of that capital
a. True b. False Indicate whether the statement is true or false