A monopolist has the power to set price, but is not entirely free to set the price of its product. Explain
What will be an ideal response?
A monopolist faces a downward-sloping demand curve. As a result, to sell more of a good a monopolist must lower the price. How much the price must be lowered is determined by the price elasticity of demand.
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Suppose a perfectly competitive industry is in long-run equilibrium. If a decrease in demand leads to a lower long-run price, we know that
A) this is a decreasing-cost industry. B) this is an increasing-cost industry. C) some firms will be losing money in the long run. D) after further adjustments, price will rise to its original level.
Average costs_____ initially due to the presence of fixed costs and then _____due to increasing marginal costs
a. rise; rise b. rise; fall c. fall; rise d. fall; fall
A nation can determine how close it is to the classical range by considering its:
a. Export position. b. Net export position. c. Capacity utilization index. d. Exchange rate. e. All of the above.
Assume an economy is producing only one product. Year 2 is the base year. Output and price data for a five-year period are given.YearUnits of OutputPrice Per Unit14$425537849951010Refer to the above data. If year 2 is chosen as the base year, the real GDP for year 1 is:
A. $20. B. $25. C. $4. D. $16.