If government regulations significantly increase the cost of operating within a particular market, one result is that
A) new firms are discouraged from entering the market.
B) barriers to entry are nullified.
C) a perfectly competitive market environment is encouraged.
D) new firms are encouraged to enter the market.
Answer: A
You might also like to view...
The current level of deposit insurance is
A) $100,000 per depositor. B) $100,000 per deposit. C) $200,000 per depositor. D) $200,000 per deposit.
Under a monopoly, resources are misallocated such that
A) too few resources are used in other industries, and too many are used by the monopoly. B) too few resources are used by the monopoly, and too many are used elsewhere. C) resources are being used as efficiently as possible only by the monopoly. D) consumers are being forced to pay a price below the MC of the monopolist.
Positive externalities are created when
A) other consumers reduce their demand for coffee and price thereby declines. B) farmers spray pesticide in their fields and it washes into the local river after the first rainstorm. C) your neighbor plants beautiful trees and flowers in her yard. D) you purchase the "Mona Lisa" and lock it in a vault.
An oil company is considering drilling in the Gulf at a current cost of $300,000 with an expected profit of $500,000 in three years. The current market rate is 10 percent. Should the company make the investment?
A. Yes, the future value of the profit is greater than the present value of the cost B. No, the future value of the profit is less than the present value of the cost C. Yes, the present value of the profit is greater than the present value of the cost D. No, the present value of the profit is less than the present value of the cost