When a firm does more of something, it gets better at it. This learning-by-doing is:
A. a source of diseconomies of scale.
B. a source of economies of scale.
C. called the principle of natural progression.
D. called "spreading the overhead."
Answer: B
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In the above figure, if the single-price monopolist charges a price that maximizes its profits, consumer surplus is
A) area hacd. B) area bac. C) area jae. D) area jbce.
A market situation in which a large number of firms produce similar but not identical products is called
A) pure monopoly. B) monopolistically competitive. C) oligopolistic behavior. D) perfectly competitive.
A firm's producer surplus equals its:
A. profit less its avoidable costs. B. revenue less its avoidable costs. C. profit less sunk costs. D. revenue less sunk costs.
Suppose the required reserve ratio is 0.20. Total bank deposits are $200 million and the bank holds $50 million in reserves. How much more money could the bank create if it does not hold excess reserves?
A. $25 million B. $50 million C. $5 million D. $30 million