When the government creates a monopoly, the social loss may include
a. declining marginal costs.
b. the cost of lawyers and lobbyists hired to convince lawmakers to continue the monopoly.
c. excessive monopoly profits.
d. diminishing marginal revenue.
b
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A competitive firm's long-run supply curve is
a. horizontal at the firm's break-even price. b. steeper than its long-run marginal cost curve. c. identical to its long-run average cost curve. d. more elastic than its short-run supply curve.
The Malthusian model emphasizes fixity in which of the following factors of production?
A) labor B) land C) energy D) none of the above
If the time for an economy to self-correct is shorter than the active policy lags, then:
a. active policy should be strengthened b. active policy is likely to destabilize the economy. c. time is required to accumulate evidence that the economy is performing below its potential. d. the aggregate demand curve shifts more rapidly than the short-run aggregate supply curve. e. active policy will work better than passive policy.
Profit can be maximized only where marginal revenue equals
a. average cost. b. total cost. c. marginal cost. d. average cost.