A monopoly is inefficient because:
a. consumers are forced to pay higher prices for products
b. firms are able to earn economic profits.
c. the cost of increased production is less than the value that society places on it.
d. price exceeds marginal revenue.
c
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In an oligopoly
A) there are only a few firms. B) there is no product differentiation. C) there is free entry and exit. D) firms' decisions are unrelated to each other.
In explaining the evolution of money
A) government regulation is the most important factor. B) commodity money, because it is valued more highly, tends to drive out paper money. C) new forms of money evolve to lower transaction costs. D) paper money is always backed by gold and therefore more desirable than checks.
If a government wants to maximize revenues from a tax it should
A) impose it on sellers. B) impose it on consumers. C) choose a good with a relatively elastic demand. D) choose a good with a relatively inelastic demand.
In the Baumol model, the total quantity sold will usually be larger than
A) if perfect competition prevailed. B) if total costs were minimized. C) if profit were maximized. D) if companies were interdependent.