How does De Beers maintain a near-monopoly on diamonds?
a. De Beers owns most of the world's diamond mines.
b. De Beers limits the number of diamonds produced at mines it does not own by controlling wholesaler access to diamonds.
c. De Beers has a 60-year old patent on cutting diamonds, and so is the only source of diamonds to U.S. jewelry stores.
d. De Beers is the only diamond manufacturer which has a license for retail sale of diamonds.
b
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Diminishing marginal returns means that the firm definitely is experiencing
A) diseconomies of scale. B) constant returns to scale. C) Both answers A and B are correct. D) Neither answer A nor B is correct.
When an economist points out that you and millions of other people are interdependent, he or she is referring to the fact that we all
a. rely upon the government to provide us with the basic necessities of life. b. rely upon one another for the goods and services we consume. c. have similar tastes and abilities. d. are concerned about one another's well-being.
What is one problem with trying to regulate a monopoly's price?
A) The government needs information on the monopoly's marginal cost. B) The government needs information on the price people are willing to pay. C) The government needs to identify which firm is a monopolist. D) Anything that the government does is problematic.
If a straight line crosses the Y-axis at 5 and crosses the X-axis at 10, we can conclude that the slope of the line is
A) positive. B) negative. C) zero. D) infinity.