One method of measuring the extent of a firm's market power is
A. price elasticity of demand for the firm's product.
B. the Lerner index.
C. income elasticity of demand for the firm's product.
D. both a and b
E. all of the above
Answer: D
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Both a perfectly competitive firm and a monopolist find that:
A. price is less than marginal revenue. B. it is best to expand production until the benefit and the cost of the last unit produced are equal. C. they can sell as many units of output as they want at the market price. D. price and marginal revenue are the same.
Trade diversion reduces worldwide efficiency, because:
a. production is diverted to the country with the comparative advantage. b. production is diverted from the country with the comparative advantage. c. unnecessary trade restrictions are created in the economies. d. consumption is diverted to the country having inadequate demand. e. the cost of transshipment of the goods increases thus raising their prices in the world market.
When Kim in Korea buys stock in GE (General Electric), NCO:
A. is zero. B. decreases. C. is unaffected. D. increases.
Which antitrust act provided that injured parties could file suit and, if successful, collect triple damages from monopolistic violators?
A. Wheeler-Lea Act B. Clayton Act C. Sherman Act D. Celler-Kefauver Act