The main purpose of the antitrust laws is:
A. to encourage firms to produce where P > MC.
B. the elimination of both negative and positive externalities.
C. to prevent the monopolization of industries.
D. to regulate natural monopolies.
Answer: C
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Which of the following statements is positive?
A. When the Federal Reserve increases the money supply, interest rates decrease. B. Higher taxes are needed to support education. C. Large budget deficits should be avoided. D. A tax cut that benefits low-income households is acceptable.
Which of the following describes the economic meanings of cost and price?
A) Cost is exchange worth, and price is dollar worth. B) Cost is what must be given up to produce a good, and price is what a seller receives when the good is sold. C) They are the same, and they both mean what is received when a good is sold. D) Cost refers to what the buyers pay for the good, and price refers to what sellers receive when the good is sold. E) Cost refers to the price that buyers must pay to buy the good.
The demand curve for each seller's product in perfect competition is horizontal at the market price because
A) all the sellers get together and set the price. B) all the demanders get together and set the price. C) the price is set by the government. D) each seller is too small to affect market price.
Mercantilism held that
A) silver alone was the mainstay of national wealth. B) gold alone was the mainstay of national wealth. C) silver and gold were the mainstays of national wealth. D) silver and gold are not important for national wealth of a country. E) labor forces were the mainstay of national wealth.