Which of the following does not necessarily apply to a pure monopoly?
A. The product the firm produces must have no close substitutes
B. The firm must be the sole producer of a product
C. The firm will charge the highest price possible
D. Entry must be blocked
C. The firm will charge the highest price possible
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Can nominal GDP ever be less than real GDP?
What will be an ideal response?
An increase in the reserve requirement would:
A) decrease excess reserves and reflect an expansionary monetary policy. B) decrease excess reserves and reflect a contractionary monetary policy. C) increase excess reserves and reflect an expansionary monetary policy. D) increase excess reserves and reflect a contractionary monetary policy.
After hiring a new employee, a manager finds that the total output has increased. When the manager hires another employee however, he realizes that although the total production has increased, the increment is less than the previous case. This is the result of:
a. diseconomies of scale. b. a general economic downturn. c. diminishing marginal returns. d. the lack of skills of the two new employees. e. constant returns to scale.
An increase in the interest rate will: a. increase the amount of money borrowed by firms
b. decrease the amount of money borrowed by firms. c. have an ambiguous effect on the amount of money borrowed by firms. d. have no effect on the amount of money borrowed by firms.