Gene's Car Wash is a natural monopoly. To wash 100 cars a week, if Gene is unregulated, he would charge a price of $10. Gene's long-run average cost for washing 100 cars is $8, his average variable cost is $6, and his marginal cost is constant at $4
If Gene was regulated using a marginal cost pricing rule, the price he would be allowed to charge to wash 100 cars is A) $10.
B) $8.
C) $6.
D) $4.
D
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The above figure shows the market for gasoline. When a hurricane destroys a major refinery that refines oil into gasoline, the
A) demand curve for gasoline shifts from D1 to D2 and the supply curve of gasoline does not shift. B) demand curve for gasoline shifts from D1 to D2 and the supply curve of gasoline shifts from S2 to S1. C) demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S2 to S1. D) demand curve for gasoline does not shift, and the supply curve of gasoline shifts from S1 to S2.
In the above table, the labor force participation rate is
A) 55 percent. B) 44 percent. C) 62 percent. D) 69 percent.
Figure 5-11
In Figure 5-11, a consumer is initially at point A. There is a price change and she moves to B. It follows that
A. the demand for beer follows the law of demand. B. the demand for beer does not follow the law of demand. C. wine is an inferior good. D. the consumer is confused.
An example of a positive externality is
A. an apple orchard increasing the number of trees next to a bee farm. B. pollution. C. the Clean Air Act. D. smoking in a crowded place.