If an upstream monopoly and a downstream monopoly vertically integrate into a profit-maximizing monopoly, then the total amount of deadweight loss in the industry
A) will increase.
B) will decrease.
C) will remain unchanged.
D) cannot be determined.
B
You might also like to view...
Suppose technical change permits cable television companies to provide their services at lower rates. The share-the-gains, share-the-pains theory would predict that the regulators would
A) permit the firms to keep the savings and would lower prices only if the firms were pressured to do so. B) force the firms to pass all the savings on to consumers in the form of lower prices. C) force the firms to pass the savings on to consumers in the form of better service. D) force the firms to pass some of the savings on to consumers and to permit the firms to keep some of the savings themselves.
Paper Pushers Inc. hires workers in a competitive labor market. Apart from labor, the company has no other variable inputs. The company's hourly output varies with the number of workers hired, as shown in the table. WorkersPages/hour0014027531054125514061507155 If the market price of each page is $5, the first worker's VMP is ________ per hour, and the third worker's VMP is ________ per hour.
A. $200; $150 B. $200; $525 C. $20; $525 D. $20; $15
Which of the following statements is true?
A. The United States today comes closer to the socialist form of economic organization than it does capitalism. B. When central planners set prices above equilibrium for goods and services they create shortages. C. According to Karl Marx, under capitalism, workers would be exploited and would revolt against the owners of capital. D. Adam Smith argued that government's role in society would be to do absolutely nothing.
Unemployment is defined as
A. A decrease in the labor force. B. The active search and inability of labor force participants to find jobs. C. The proportion of the total population that is unemployed. D. The active search and inability of citizens to find jobs that utilize their capabilities.