For a monopoly to be a natural monopoly,
A. the long-run average cost curve must continue to increase until it hits the market demand curve.
B. economies of scale must be realized at a scale that is close to total demand in the market.
C. economies of scale must be realized at a scale that is small relative to the market.
D. there must be constant returns to scale.
Answer: B
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Which of the following describes a moral hazard problem?
A) a process by which individuals have substantial resources devoted to the exchange process and need to make a profit or they will be adversely affected B) a process by which individual buyers or sellers with better information are more likely to participate in voluntary exchange C) a contractual problem that results because monopolies exist in all economies D) a post-contractual problem that may result because participants to the exchange process have information that allows them to act in an opportunistic manner
Democrats argue that labor demand is ________, so ________ jobs will be lost when the minimum wage is raised.
A. elastic; many B. elastic; few C. inelastic; many D. inelastic; few
Which of the following is one of the most important benefits of money in an economy?
a. Money allows for the exchange of goods and services. b. Money allows for the accumulation of wealth. c. Money makes exchange easier, leading to more specialization and higher productivity. d. Money encourages people to produce all of their own goods (self-sufficiency) and therefore increases economic stability.
The monetary efficiency
A) loss from pegging the Norwegian krone to the euro (for example) will be higher if factors of production can migrate freely between Norway and the euro area. B) gain from pegging the Norwegian krone to the euro (for example) will be lower if factors of production can migrate freely between Norway and the euro area. C) gain from pegging the Norwegian krone to the euro (for example) will be higher if factors of production can not migrate freely between Norway and the euro area. D) gain from pegging say the Norwegian krone to the euro (for example) will be higher if factors of production can migrate freely between Norway and the euro area. E) gain or loss from pegging the Norwegian krone to the Euro cannot be predicted using the available information.