The deadweight or social loss of monopoly:
a. is representative of production inefficiency.
b. reflects a transfer from consumer surplus to monopoly profit.
c. is representative of the low sales resulting from the high price charged by the monopolist.
d. reflects that part of lost consumer surplus which is not transferred to monopoly profit.
d
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Assume a hypothetical case where an industry begins as perfectly competitive and then becomes a monopoly. As a result of this change
A) price will be higher, output will be lower, and the deadweight loss will be eliminated. B) consumer surplus will be smaller, producer surplus will be greater, and there will be a reduction in economic efficiency. C) consumer surplus will be smaller and producer surplus will be greater. There will be a net increase in economic surplus. D) price will be higher, consumer surplus will be greater, and output will be greater.
Early Keynesians concluded that changes in monetary policy had no impact on aggregate output because early empirical studies found no linkage between movements in ________ and ________
A) nominal interest rates; investment spending B) real interest rates; investment spending C) money supply; aggregate output D) investment spending; aggregate output
Suppose the intersection of the IS and LM curves is to the left of the FE line. What would most likely eliminate a disequilibrium among the asset, labor, and goods markets?
A) A rise in the price level, shifting the LM curve up and to the left B) A fall in the price level, shifting the LM curve down and to the right C) A rise in the price level, shifting the IS curve up and to the right D) A fall in the price level, shifting the IS curve down and to the left
The nation closest to a centrally planned, socialist economy is
A. China. B. Japan. C. the United States. D. Norway.