Which of the following is NOT characteristic of a perfectly competitive market?
A.) firms are price takers
B.) a significant degree of brand loyalty for each firm
C.) low barriers to entry
D.) many firms
Answer: B.) a significant degree of brand loyalty for each firm
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Rather than prohibiting a good or service, the government might tax it. Imposing such a tax on a good or service ________ the equilibrium price and ________ the equilibrium quantity
A) raises; increases B) raises; decreases C) lowers; increases D) lowers; decreases
Because a monopoly will produce less of a good than a competitive market will, welfare is always greater under monopoly than under competition in the presence of a negative externality
Indicate whether the statement is true or false
Without externalities, _____
a. private costs equal social costs b. private benefits exceed social benefits c. private costs are greater than social costs d. private benefits are lesser than social benefits
When indifference curve analysis is used, a consumer optimum occurs at the point at which
A. the indifference curve is tangent to the budget line. B. the indifference curves intersect. C. marginal utility/price ratio of all goods consumed is equal. D. total utility is maximum.