De Beers accounts for approximately 80% of diamond sales worldwide. The source of its market power is:
A. its patent on diamond production.
B. the perfectly inelastic demand for diamonds.
C. the engagement customs of couples in Western cultures.
D. its exclusive ownership of South African diamond mines.
Answer: D
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The monetary base does NOT include which of the following items?
i. Federal Reserve notes ii. banks' reserves at the Federal Reserve iii. U.S. government securities owned by the Federal Reserve A) i only B) ii only C) iii only D) both i and ii E) both ii and iii
If a tariff is imposed on imports of shrimp into the United States, U.S. producer surplus from shrimp will ________ and U.S. total surplus from shrimp will ________
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease E) increase; not change
In the above figure, the short-run aggregate supply curve is SAS1. Suppose that the price level in the economy increases. As a result there is
A) an upward movement along SAS1. B) a downward movement along SAS1. C) a shift to SAS0. D) a shift to SAS2.
The marginal revenue of a monopolistically competitive firm
A) will equal average revenue. B) cannot be negative because the price the firm charges will always be greater than zero. C) can be negative if the firm charges a high price. D) can be negative if the firm charges a low price.