When economies of scale limit the number of firms in an industry to 3, there is a
A) natural monopoly.
B) natural oligopoly.
C) legal oligopoly.
D) legal cartel.
E) natural monopolistic competition.
B
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An MPI of 0.4 indicates that for every 100 percent increase in domestic income:
a. there is a 40 percent increase in investment. b. there is a $40 increase in investment. c. there is a 40 percent decline in imports. d. there is a $40 increase in imports. e. there is a 40 percent increase in imports.
Neither positive nor negative supply shocks a. Change AD
b. Permanently change real output in an economy. c. Change the price level in the long run. d. Do any of the above
Which of the following statements is correct?
a. If duopolists successfully collude, then their combined output will be equal to the output that would be observed if the market were a monopoly. b. Although the logic of self-interest decreases a duopoly's price below the monopoly price, it does not push the duopolists to reach the competitive price. c. Although the logic of self-interest increases a duopoly's level of output above the monopoly level, it does not push the duopolists to reach the competitive level. d. All of the above are correct.
Refer to the following graph to answer the question:
Over the price range $90 to $110, marginal revenue is ________ and demand is ________.
A. positive; elastic B. negative; inelastic C. less than one; elastic D. greater than one; inelastic E. none of the above