If the government regulates the price that a natural monopolist can charge to be equal to the firm's marginal cost, the firm will
a. earn zero profits.
b. earn positive profits, causing other firms to enter the industry.
c. earn negative profits, causing the firm to exit the industry.
d. minimize costs in order to lower the price that it charges.
c
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A change in a marginal benefit or cost will
A) increase consumption. B) decrease production. C) cause an individual to make a rational choice. D) increase sunk costs. E) change incentives.
Knowing how to translate between present and future value can be useful when:
A. the benefits and opportunity cost occur at different times. B. there are benefits and costs occurring at the same time. C. the current costs are higher than the present benefits. D. there are no benefits and costs.
Which of the following is not a consequence of deflation?
A. Deflation causes uncertainty about the future. B. The threat of deflation can make people reluctant to borrow for long periods. C. Deflation causes the real value of money to fall. D. Firms may be reluctant to undertake investments for fear that the prices at which they can sell their output will drop.
Using the rule of 70, if the GDP per capita growth rate in the United States is 3.5 percent, real GDP per capita doubles every:
A. 20 years. B. 24.5 years. C. 35 years. D. 70 years.