A market in which the Herfindahl-Hirschman Index is 1,000 is regarded by the Federal Trade Commission as
A) moderately concentrated.
B) concentrated.
C) competitive.
D) monopolistic.
C
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Consider two types of rules that might govern an otherwise unregulated health insurance market: (1) Insurance companies can price-discriminate against the sick and old; (2) insurance companies cannot price discriminate against the sick and old. Explain why, in equilibrium, insurance may be very expensive for the sick and old regardless of which case we find ourselves in.
What will be an ideal response?
The potential output of an economy is: a. the output level at which inflation is very high
b. the output level at which nominal GDP is equal to real GDP. c. less than the full-employment rate of output. d. the output level at which total unemployment is zero. e. also referred to as the natural rate of output.
A decrease in the number of workers hired by a firm could result from
A. a decrease in the real wage. B. an increase in the real wage. C. an increase in the marginal revenue product of labor. D. an increase in the marginal product of labor.
Industrially advanced countries can best help DVCs by:
A. Directing requests from DVCs for aid to the World Bank B. Using the International Monetary Fund to determine exchange rates in DVCs C. Increasing management control over development projects D. Adopting policies that expand trade with DVCs