Refer to the diagram for a pure monopolist. If a regulatory commission seeks to achieve the socially optimal allocation of resources to this line of production, it will set a price of:
A. P 1 .
B. P 3 .
C. P 2 .
D. P 4 .
C. P 2 .
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The natural rate hypothesis asserts that
A) changes in the unemployment rate from changes in the inflation rate are temporary. B) changes in the unemployment rate are natural and long-lasting. C) when prices change, the inflation rate changes temporarily and then returns to its natural rate. D) changes in the natural unemployment rate are only temporary. E) price changes occur at a natural rate, near a 6 percent average inflation rate.
Your friend has just received a new book he ordered and you want to borrow it. Your friend values reading the book at $10, while you are willing to pay a maximum amount of $15 to read it
a) What is the equilibrium outcome in this case? b) Will the outcome be any different if you own a book that your friend wants to read? Assume that the value that each of you places on this book is the same as that you placed on the previous book.
Which of the following is true? a. Price leadership is a form of explicit collusion
b. Price leadership is more likely when there are a substantial number of roughly equally sized firms in oligopoly. c. A price leader is most likely to be a dominant firm in an industry. d. None of the above is true.
Marginal revenue product is the
a. additional revenue from one additional dollar increase in price. b. change in the revenue product resulting from one additional unit of input. c. additional revenue from one additional unit of input. d. change in revenue resulting in one additional dollar in price.