The major incentive for cost minimization is the
a. power of shareholders in the company.
b. fear of top management by workers.
c. discipline imposed by the market system.
d. impact on U.S. corporations of taxing by the government.
c
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A reduction in a country's saving rate will tend to cause which of the following in the long run?
A) an increase in labor productivity B) an increase in the standard of living C) a reduction in economic growth D) an increase in per capita real GDP
Cartels display a pronounced tendency to disintegrate over time because
A) increased profits induce laziness and carelessness among cartel members. B) nobody benefits in the long run from their operation since they merely redistribute wealth. C) their operation is so blatantly contrary to the public interest. D) there are so many margins on which competition can occur.
Deadweight loss from monopoly power is expressed on a graph as the area between the
A) competitive price and the average revenue curve bounded by the quantities produced by the competitive and monopoly markets. B) competitive price line and the marginal cost curve bounded by the quantities produced by competitive and monopoly markets. C) competitive price line and the monopoly price line bounded by zero output and the output chosen by the monopolist. D) average revenue curve and the marginal cost curve bounded by the quantities produced by competitive and monopoly markets.
If at the current output of X the PX < MCX, then society gains by
A. increasing the cost of producing X. B. producing more X. C. lowering the price of X. D. producing less X.