Suppose that a regulatory agency has imposed marginal cost pricing on a natural monopolist. We expect that
A) the firm will earn only a normal profit.
B) the firm's average total cost of production is rising over the relevant range of production.
C) the firm will earn economic profits.
D) the firm will eventually go out of business.
D
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To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.
U.S. capital at the end of 2012 equals U.S. capital at the beginning of 2012 plus
A) gross investment during 2012. B) net investment during 2012. C) nothing, because capital can't change in just one year. D) gross investment during 2012 minus net investment in 2012. E) depreciation during 2012 minus gross investment during 2012.
The table above gives costs at Jan's Bike Sho
A) $200 B) $300 C) $400 D) $500 E) None of the above answers is correct.
If the aggregate price level at time t is denoted by Pt, the inflation rate from time t - 1 to t is defined as
A) ?t = (Pt - Pt - 1)/Pt - 1. B) ?t = (Pt + 1 - Pt - 1)/Pt - 1. C) ?t = (Pt + 1 - Pt )/Pt. D) ?t = (Pt - Pt - 1)/Pt.