An insecure monopoly can deter another firm from entering the market by setting its quantity equal to:
A. the zero profit quantity.
B. the zero profit quantity - the minimum entry quantity.
C. the minimum entry quantity.
D. the zero profit quantity + the minimum entry quantity.
Answer: A
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When a negative externality exists in the case of a particular good, and if that is not reflected in the price, _____
a. too little of that good is produced and consumed b. too much of that good is produced and consumed c. all resources are taken away from the production of that good d. the government completely prohibits the consumption of that good e. all resources are allocated to the production of that good
Which of the following pairs best represents substitute goods?
a. French fries and uncooked potatoes b. French fries and hot dogs c. French fries and French toast d. French fries and fried onion rings e. French fries and the French chef
The ease with which an asset can be converted into a medium of exchange is known as:
a. volatility. b. liquidity. c. currency. d. speculative exchange.
Suppose the government issues a limited number of pollution permits in order to limit the quantity of pollution. Under this policy, does the demand curve for pollution rights determine the quantity of pollution, or does it determine the price of pollution?