When a monopolist chooses the level of output where marginal cost equals marginal revenue the price:
A. equals marginal revenue.
B. equals average revenue.
C. is lower than average revenue.
D. is lower than marginal revenue.
B. equals average revenue.
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The principal-agent problem:
A. is when the principal has more information than the agent. B. is when the principal and agent have the same objectives. C. is when the agent is tempted to put in more effort than the principal would like. D. is commonly seen in the employer-employee relationship.
Answer the following statement(s) true (T) or false (F)
1. When U.S. tourists go abroad, their use of hotels and other services is recorded in service exports in the current account. 2. A current account deficit in the U.S. balance of payments coincides with a financial account surplus. 3. If a U.S. resident obtains a loan from a foreign bank, the transaction is recorded in the financial account of the U.S. balance of payments. 4. When the U.S. balance of payments is zero, then the number of U.S. dollars demanded equals the number of U.S. dollars supplied. 5. A consumer in a foreign country who is buying U.S. goods must sell U.S. dollars to obtain foreign currency to pay for those goods.
Refer to the graph above. Which of the following factors will shift AS 1 to AS 2?
An increase in input prices A decrease in business taxes An increase in real interest rates A decrease in business subsidies
Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. lower; higher D. higher; potential