Discuss some of the reasons why monopoly power is considered undesirable.
What will be an ideal response?
Some of the reasons are:
| 1. | High prices reduce the well-being of consumers. |
| 2. | High prices lead to resource misallocation. |
| 3. | Monopoly power creates an obstacle to efficiency and innovation. |
You might also like to view...
A farmer who has fixed amounts of land and capital finds that total product is 24 for the first worker hired; 32 when two workers are hired; 37 when three are hired; and 40 when four are hired. The farmer's product sells for $3 per unit and the wage rate is $13 per worker. How many workers should the farmer hire?
A. 1 B. 2 C. 3 D. 4
A bond with default risk will always have a ________ risk premium and an increase in its default risk will ________ the risk premium
A) positive; raise B) positive; lower C) negative; raise D) negative; lower
If consumption spending increases by $10 million with no changes in net taxes, then:
A. private saving decreases. B. public saving increases. C. private saving increases. D. public saving decreases.
Explain how a business chooses to set output
What will be an ideal response?