Which of the following statements correctly identifies a similarity between monopoly and perfect competition?
A) Entry is restricted in both market structures.
B) Price equals marginal cost in both market structures.
C) Production is expanded until marginal revenue equals marginal cost in both the market structures.
D) Firms face an upward sloping demand curve and a downward sloping marginal revenue curve in both the market structures.
Answer: C) Production is expanded until marginal revenue equals marginal cost in both the market structures.
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Use the figure below to answer the following question.
At equilibrium, consumer surplus is
A. 400. B. 200. C. 150. D. 300.
Perfect competition is characterized by all of the following EXCEPT
a. a large number of buyers and sellers. b. identical products. c. sellers acting together to set prices. d. well-informed buyers and sellers.
If a household earning $50,000 annually pays $10,000 in taxes while a household earning $100,000 annually pays $20,000 in taxes, then the tax system is
A. progressive. B. redistributive. C. neither regressive nor progressive. D. regressive.
Compared to a cartel, firms in a Cournot Oligopoly
A) make more joint profit. B) sell less output. C) make less joint profit. D) act independently.