The conclusion that a monopoly results in lower output and higher prices than perfect competition relies on the assumption that
A) the demand curve for a monopoly is horizontal.
B) consumers are ignorant of the effects of monopoly.
C) the costs of production are the same whether the industry is perfectly competitive or a monopoly.
D) elasticity of demand varies along the market demand curve.
C
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If you take out a bank loan prior to unanticipated inflation
A) your bank will gain at your expense. B) you will gain at the expense of your bank. C) it will be harder for you to repay the loan because of the inflated dollar. D) neither you nor your bank will be affected, because the loan was made prior to the inflation.
Economic efficiency is a market outcome in which the marginal benefit to consumers is equal to the marginal cost of production and the sum of consumer surplus and producer surplus is maximized
Indicate whether the statement is true or false
When the Federal Reserve System was first established, which of the following was its chief responsibility?
a. Keeping the inflation rate low and stable b. Ensuring the stability of the banking system c. Achieving full employment of the labor force d. Keeping the interest rate low and stable e. Keeping output growth high and stable
The less liquid markets are the:
A. more willing people are to save and the higher the interest rates. B. less willing people are to save, and the higher the interest rates. C. less willing people are to save, and the lower the interest rates. D. more willing people are to save, and the lower the interest rates.