A natural monopoly exists when, throughout the range of market demand,
a. average cost is increasing
b. there are diseconomies of scale
c. average cost is decreasing
d. average cost is constant
e. marginal cost exceeds average cost
C
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Suppose that the marginal propensity to save (MPS) equals 0.8. The value of the multiplier would be
A) 0.2. B) 0.8. C) 1.25. D) 5.0.
A necessary condition for exchange rate stability where the sum of the elasticity of import demand and the elasticity of export supply must be greater than one is known as
A) the Marshall Lerner condition. B) the elasticities rule. C) the elasticities approach. D) the exchange rate condition.
Which of the following acts prohibited false advertising?
a. Sherman Act b. Clayton Act c. Federal Trade Commission Act d. Celler-Kefauver Act
If aggregate quantity supplied exceeds aggregate quantity demanded, we can expect an unplanned
a. depletion of inventories, causing firms to raise prices. b. depletion of inventories, causing firms to lower prices. c. accumulation of inventories, causing firms to raise prices. d. accumulation of inventories, causing firms to lower prices.