OPEC became a successful cartel in the 1970s by deciding to restrict oil production.
Answer the following statement true (T) or false (F)
True
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When a monopolist maximizes its profit by selling a positive amount:
A. its marginal revenue must equal its marginal cost at that quantity. B. its marginal revenue must exceed its marginal cost at that quantity. C. its marginal revenue must be less than its marginal cost at that quantity. D. its marginal revenue must be equal to zero.
Refer to Scenario 17.3. If there is no insurance and a fire protection program in place, the expected loss from fire for this company is
A) $0. B) $300. C) $3,000. D) $6,000. E) $300,000.
Cartel models are most like
a. duopoly b. monopoly c. kinked demand d. monopolistic competition e. price leadership
Which of the following is correct concerning opportunity cost?
a. Except to the extent that you pay more for them, opportunity costs should not include the cost of things you would have purchased anyway. b. To compute opportunity costs, you should subtract benefits from costs. c. Opportunity costs and the idea of trade-offs are not closely related. d. Rational people should compare various options without considering opportunity costs.