The producer surplus to a monopolist must be
A) less than zero or the firm is in violation of anti-trust statutes.
B) at least as great as the producer surplus in a competitive market.
C) positive, otherwise why would the monopoly produce?
D) the same as for a competitive market.
B
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What happens to real money demand (rise, fall, no change) due to a change in each of the following factors?
(a) A tax on stock market transactions is introduced. (b) Computerized bond trading reduces transactions costs. (c) People's average level of wealth rises. (d) The threat of a recession increases the riskiness of stocks and bonds. (e) The interest rate paid on checking account balances declines. (f) The price level falls in a one-time jump.
The game in Scenario 13.10 is
A) variable-sum. B) constant-sum. C) cooperative. D) a Prisoners' Dilemma. E) a Cournot Production Cross.
What would happen in a free market system when production of a good generates negative externalities?
A) There is a shortage of the good. B) There is a surplus of the good. C) The equilibrium quantity of the good is less than the efficient amount. D) The equilibrium quantity of the good is more than the efficient amount.
If the sacrifice ratio is 4, then reducing the inflation rate from 9 percent to 5 percent would require sacrificing
a. 4 percent of annual output. b. 8 percent of annual output. c. 12 percent of annual output. d. 16 percent of annual output.