Which of the following should be expected if the tax for a certain good increases?
A. price of the good increases.
B. the composition of the commodity bundle is distorted.
C. the budget line pivots out.
D. the composition of the commodity bundle is distorted and the price of the good increases.
D. the composition of the commodity bundle is distorted and the price of the good increases.
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If marginal cost exceeds average total cost in the short run, then which is likely to be true?
A. Marginal cost is less than average variable cost. B. Average total cost is less than average variable cost. C. Average total cost is increasing. D. Average variable cost is decreasing.
Refer to Figure 18-1. Area B + C represents
A) the portion of sales tax revenue borne by consumers. B) the portion of sales tax revenue borne by producers. C) the excess burden of the sales tax. D) sales tax revenue collected by the government.
A market with one buyer and one seller is a
A. Bilateral monopoly. B. Multiopoly. C. Bilateral monopsony. D. Multilayer monopoly.
A monopoly differs from monopolistic competition in that
A) a monopoly has market power while a firm in monopolistic competition does not have any market power. B) a monopoly can never make a loss but a firm in monopolistic competition can. C) in a monopoly there are significant entry barriers but there are low barriers to entry in a monopolistically competitive market structure. D) a monopoly faces a perfectly inelastic demand curve while a monopolistic competitor faces an elastic demand curve.