When government regulations force a natural monopoly to produce where price equals average total cost, social welfare is
a. maximized
b. less than it would be without regulation
c. greater than it would be without regulation, but it is not maximized
d. exactly the same as it would be without regulation
e. minimized
C
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That an increasing number of jobs that do not pay enough to subsist on is ____ theory of poverty.
A. a conservative B. a liberal C. both a liberal and a conservative D. neither a liberal nor a conservative
If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices. B. lower level of output and prices. C. higher level of output and prices. D. lower level of output at higher prices.
In a market system, the costs associated with exchanging goods are known as
A) voluntary costs. B) signaling costs. C) implicit costs. D) transaction costs.
A temporary decline in productivity would cause the IS curve to
A. shift up and to the right. B. shift down and to the left. C. remain unchanged. D. shift up and to the right only if people face borrowing constraints.