A natural monopolist that sets prices equal to marginal cost will:
A. incur losses.
B. earn zero accounting profits.
C. be inefficient.
D. set a price greater than average total costs.
Answer: A
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Which of the following tools is used to compare the income per capita across countries?
A) Purchasing power parity B) The headcount index C) The GDP deflator D) Production possibilities frontier
Refer to the scenario above. If Joseph prefers more money to less, ________
A) he will not accept any offer made by Phillip B) he will always accept any offer made to him C) Phillip will offer the lowest possible amount to Joseph D) he will accept the offer only if Phillip pays him an equal share of the money
The government budget deficit, ________, is ________ when saving exceeds domestic investment
A) (T - G), created B) (T - G), partially financed C) (G - T), created D) (G - T), partially financed
If the price elasticity of demand is 0.5, then a 10% increase in price results in a
A) 5% decrease in total revenues. B) 5% decrease in quantity demanded. C) 0.5% decrease in quantity demanded. D) 5% increase in quantity demanded. E) 50% reduction in quantity demanded.