With a natural monopoly, the fair return price:
A. Is allocatively efficient; the socially optimal price is allocatively inefficient
B. Is allocatively inefficient; the socially optimal price is allocatively efficient
C. And the socially optimal price are both allocatively inefficient
D. And the socially optimal price are both allocatively efficient
B. Is allocatively inefficient; the socially optimal price is allocatively efficient
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Based on the figure below. Starting from long-run equilibrium at point C, a tax increase that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.
A. D; C B. D; B C. A; B D. B; C
The monetary transmission mechanism that assumes that money supply growth stimulates the economy primarily by encouraging investment is
A) the classical transmission mechanism. B) pre-Keynesian transmission mechanism. C) the interest-rate-based transmission mechanism. D) the post-Keynesian transmission mechanism.
If you buy food which then is put on special at half price just after you paid,
A. your welfare will not change since you just finished your shopping. B. you will be disappointed and be worse off. C. you will be better off because you will go back to get some more food at bargain prices. D. logic cannot lead to an answer to this question even if you have a typical preference pattern.
An example of a monopoly would be
A) one of many U.S. wheat farmers. B) one of the few U.S. auto makers. C) AT&T cell phone service. D) the local water company. E) Taco Bell