Monopolies can make an economic profit in the long run because of
A) rent seeking by competitors.
B) the elastic demand for the monopoly's product.
C) the cost-savings gained by the monopoly.
D) barriers to enter the monopoly's market.
D
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If the natural monopoly shown in the figure above is unregulated, it will sell
A) 2 million units. B) 3 million units. C) 4 million units. D) 5 million units.
A carbon tax which is designed to reduce pollution is an example of a
A) noneffective incentive. B) command-and-control policy. C) market-based policy. D) government administrative rule.
Refer to the accompanying figure, which shows the annual domestic supply and annual domestic demand for jeans in a small country.
Suppose this country initially does not trade with the rest of the world. If the world price of a pair of jeans is $40, and this country opens itself to trade, then the annual domestic production of jeans will:
A. increase from 20,000 to 28,000. B. increase from 4,000 to 28,000. C. fall from 20,000 to 4,000. D. fall from 28,000 to 4,000.
The maximum potential money multiplier is equal to
A. the inverse of the required reserve ratio. B. the number of dollars on reserve. C. one minus the reserve ratio D. the reserve ratio.