If the government wants a natural monopoly to earn a "fair return" or zero economic profit, it will set
a. price equal to marginal cost.
b. price equal to average total cost.
c. price equal to average revenue.
d. marginal cost equal to marginal revenue.
e. marginal cost equal to average total cost.
B
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Suppose that the United States and Cuba decide to open up trade. If each country specializes in the good in which it has a comparative advantage, ________ will gain from that trade because ________
A) both countries; consumption possibilities in both Cuba and the United States will lie outside their PPFs. B) neither country; their consumption possibilities will not change. C) only the United States; consumption possibilities in Cuba will lie outside its PPF and U.S. consumption possibilities will not change. D) only Cuba; consumption possibilities in Cuba will lie outside its PPF and U.S. consumption possibilities will not change.
When there are many thousands of small stockholders in a company, for each the cost of monitoring manager performance is well __________ the benefits of doing so, which helps __________ the manager-stockholder problem
A) above; alleviates B) above; brings on C) below; alleviates D) below; brings on
The three reasons why the aggregate demand curve slopes downward are
a. the international substitution effect, the net exports effect and the interest rate effect. b. the interest rate effect, the short run effect and the free rider effect c. the net exports effect, the real balance effect and the short run effect d. the real balance effect, the international substitution effect and the interest rate effect.
As far as contributions to a professional sports team's bottom line are concerned, players generally receive
a. about what they are worth. b. about half of what they are worth. c. about ten times more than what they are worth. d. about twice what they are worth.