A local monopoly is a firm that:
a. is the sole supplier of a good, without substitutes, in a specific geographic area.
b. is one of the suppliers of a good in a specific geographic area.
c. supplies all the products needed by consumers in a country.
d. produces to meet the requirement of only one consumer.
e. is one of the suppliers of a good that has a lot of substitutes, in a specific geographic area.
a
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
For any import quota a country imposes, there exists a tariff the country could have imposed that will have the same impact on producers and consumers.
Answer the following statement true (T) or false (F)
Both a perfectly competitive firm and a monopolist:
a. always earn an economic profit. b. maximize profit by setting marginal cost equal to marginal revenue. c. maximize profit by setting marginal cost equal to average total cost. d. are price takers.
Only at the point of consumer equilibrium does the marginal rate of substitution (MRS) equal the:
a. slope of the budget line. b. slope of the indifference curve. c. price ratio. d. all of these.