In monopoly when supernormal profits are made:
a) The price set is greater than the average cost.
b) The price is less than the marginal cost.
c) The average revenue equals the marginal cost.
d) Revenue equals total cost.
Answer: a) The price set is greater than the average cost.
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Refer to the accompanying table. ________ has the comparative advantage in making pizza, and ________ has the comparative advantage in delivering pizza. Pizzas Made Per HourPizzas Delivered Per HourCorey126Pat1015
A. Corey; Corey B. Pat; Corey C. Pat; Pat D. Corey; Pat
General Electric and Westinghouse were convicted of
A. Price-fixing. B. Price leadership. C. Marginal cost pricing. D. Allocation of market shares.
A rent ceiling set below the equilibrium rent
A) ensures the availability of enough low-rent apartments in a city. B) results in all renters and potential renters being better off. C) creates a situation in which the quantity demanded of housing is greater than quantity supplied. D) ensures that landlords earn a reasonable rate of profit on apartments. E) eliminates discrimination by landlords.
Refer to Figure 3. For Ben, the opportunity cost of 1 pound of ice cream is
a. 1/14 pound of cones.
b. 1/2 pound of cones.
c. 2 pounds of cones.
d. 4 pound of cones.