If a firm can raise market price by reducing its output, then
A. It is a price taker.
B. It has no market power.
C. It engages in marginal cost pricing.
D. It faces a downward-sloping demand curve.
Answer: D
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At the profit-maximizing level of output for a pure monopoly ________.
A. price is less than marginal cost B. total revenue is greater than total cost C. price is equal to marginal cost D. price is greater than marginal cost
To calculate gross domestic product, you use the sum of the market values of all final goods and services produced in a given year. This means you
A) count the total number of final goods and services produced in the marketplace in that particular year and then add the numbers together. B) count the total number of final goods and services produced in the marketplace from every year including that given year and then add the numbers together. C) value the final goods and services at their market prices for that particular year, multiply them by the quantity produced that year, and then add the numbers together. D) value the final goods and services at their market prices for that particular year, multiply them by the quantity produced from every year including that given year, and then add the numbers together.
In a Lorenz curve diagram, the 45° line represents:
a. perfect income equality. b. zero inflation. c. a negative income tax. d. an extremely unequal distribution of income.
When the selling price of a good rises (goes up), what is the relationship to the quantity supplied?
a. The profit made on each item goes down. b. It becomes practical to produce more goods. c. The cost of production goes down. d. There is no relationship between the two.