In comparison with a perfect competition, a single-price monopolist with the same costs creates a ________ consumer surplus and makes a ________ economic profit
A) smaller; larger
B) smaller; smaller
C) larger; larger
D) larger; smaller
A
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
Sam has $200 a month to spend on two normal goods-tanning sessions or rounds of golf. Tanning sessions are $20 each, and a round of golf is $40. Sam currently consumes six tanning sessions and two rounds of golf. If the price of a round of golf drops to $20, the income effect:
A. predicts Sam will increase his consumption of both golf and tanning sessions. B. predicts Sam will double his consumption of golf. C. predicts Sam will consume more golf and less tanning sessions. D. predicts Sam will consume less golf and more tanning sessions.
Negative externalities:
a. are found only in large cities. b. occur whenever individual health is harmed in the production process. c. impose most of their costs directly on consumers of polluting processes. d. impose most of their costs on individuals other than consumers of the polluting product.
If the United States purchases oil from Kuwait, what is the effect in the exchange market? a. It will increase the supply of U.S. dollars
b. It will decrease the supply of U.S. dollars. c. It will increase the demand for U.S. dollars. d. It will decrease the demand for U.S. dollars.