Which of the following is the BEST example of a natural monopoly?
A) book publisher
B) electric utility
C) coffee shop
D) airline
Answer: B
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The first economist to point out the importance of specialization of labor was
A. Leonardo da Vinci. B. Adam Smith. C. David Ricardo. D. John Maynard Keynes. E. Enrico Caruso.
Oil refiners can refine a barrel of petroleum so that it yields either more home heating oil or more diesel fuel. If the price of diesel fuel falls, there is
A) an increase in the supply of home heating oil. B) a decrease in the supply of home heating oil. C) an increase in the quantity of home heating oil supplied. D) a decrease in the quantity of home heating oil supplied. E) an increase in the demand for home heating oil.
According to the U.S. Robinson-Patman Act of 1936, price discrimination
A) is always illegal. B) is legal unless it harms competition. C) may be used to drive rivals out of business. D) can only be justified if the price discrimination is due to actual cost differences.
Which of the following serves as a basis for doomsday forecasts?
A. The price mechanism. B. Substitution effects. C. Crowding out. D. Resource constraints.