Refer to the graph shown. If the monopoly firm maximizes profit, there will be a welfare loss equal to:
A. $5.00.
B. $2.50.
C. $10.00.
D. $7.50.
Answer: D
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Initially, a perfectly competitive industry that has 1,000 firms is in long-run equilibrium. Then 100 firms in the industry adopt a new technology that reduces the average cost of producing the good
In the short run, the price ________, firms with the new technology make ________ economic profit, and firms with the old technology ________. A) remains the same; zero; incur economic losses B) falls; positive; incur economic losses C) remains the same; positive; make normal profit D) remains the same; positive; incur economic losses
What are the benefits and costs associated with monopolistic competition?
What will be an ideal response?
ABC Company is currently producing 450 units of output. The output is sold in a perfectly competitive market at a price of $35 . The marginal cost of the 450th unit is $38
Is ABC Company producing at the profit-maximizing level of output? Explain.
As workforces become more educated in countries with comparative advantages in labor-intensive products, cheap labor becomes:
A. more abundant relative to capital. B. less abundant relative to skilled labor. C. more abundant relative to skilled labor. D. None of these is true.