Which of the following statements regarding the requirement that a firm be granted a license to operate in a particular market is false?
A) Advocates of licensing maintain that the practice is necessary to maintain quality of service.
B) One of the economic effects of a license requirement is to constrain the available supply of the affected good or service.
C) The requirement that they be licensed ensures that the affected firms will be able to earn a positive economic profit.
D) Relaxing certain licensing requirements should increase the supply of the affected good or service.
C
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The marginal cost curve crosses
a. only the average variable cost curve at its bottom. b. both the average cost curve and the average variable cost curve at their bottoms. c. only the average cost curve at its bottom. d. the marginal product curve at its maximum.
Which of the following are goals of monetary policy?
A) maximizing the value of the dollar relative to other currencies, economic growth, and high employment B) price stability, economic growth, and high employment C) price stability, economic growth, and maximizing the value of the dollar relative to other currencies D) price stability, maximizing the value of the dollar relative to other currencies, and high employment
Suppose that the average equilibrium monthly rental price of apartments and rooms in a college town had been steady at $600, but then the college expanded enrollment from 10,000 to 12,000, and suddenly there was a shortage of rental housing at the prevailing price of $600 . Which of the following is most likely to be true?
a. The shortage occurred because demand increased, and a new market equilibrium will feature higher rental prices and more rental units available on the market. b. The shortage occurred because demand decreased, and a new market equilibrium will feature lower rental prices and fewer rental units available on the market. c. The shortage occurred because demand increased, and a new market equilibrium will feature higher rental prices and fewer rental units available on the market. d. The shortage occurred because supply increased, and a new market equilibrium will feature lower rental prices and fewer rental units available on the market.
If a production possibilities curve were bowed in or convex to the origin of a graph, it would demonstrate:
A) increasing opportunity cost. B) decreasing opportunity cost. C) constant opportunity cost. D) fluctuating opportunity cost.