Firms that sell information products experience relatively high fixed costs but, once they have produced the first unit, can
A. sell additional units at a loss, or above cost.
B. experience short-run diseconomies of scale.
C. sell additional units at a relatively low cost per unit.
D. provide expensive information products to consumers.
Answer: C
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Which of the following is TRUE for a perfect price-discriminating monopoly?
A) P = MR for each unit sold B) P = ATC for each unit sold C) P = MC for each unit sold D) P > MC for each unit sold
The delay between when a policy action is taken and when they affect the economy is referred to as the
A) impact lag. B) action lag. C) recognition lag. D) policy lag.
If the MPS = .25, and investment falls from $100 to $75, real GDP will decrease by:
a. $25. b. $75. c. $150. d. $125. e. $100.
Suppose there is only one gas station within hundreds of miles. The owner finds that when she charges $3 a gallon, she sells 199 gallons a day, and when she charges $2.99 a gallon, she sells 200 gallons a day. The owner, obviously, is ________ and the marginal revenue of the 200th gallon of gas is __________
a. a perfect competitor (because all gas stations are perfect substitutes); $.01 b. a monopolist; $1 c. a monopolist; $2.99 d. in monopolistic competition (because gas is perceived as a differentiated product); $3 e. in monopolistic competition (because gas is perceived as a differentiated product); $600