If a public service commission requires a natural monopoly to set its price equal to the long-run marginal cost, this will result in
A. normal economic profits to the monopoly.
B. losses to the monopoly.
C. either economic profits or losses, depending on the efficiency of the monopoly.
D. excessive economic profits to the monopoly.
Answer: B
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Which of the following statements concerning perfect competition is not true?
a. Firms are price takers. b. The demand curve facing an individual firm is horizontal. c. A firm's demand curve is identical to its marginal revenue curve. d. The firms produce differentiated products. e. If a firm raises its price, it will lose all of its customers.
A rent control law, where tenants pay below-market rents, is a market restriction that may induce a decrease in the supply of rented apartments
a. True b. False Indicate whether the statement is true or false
Frictional unemployment will typically be a short-term problem for someone between jobs
a. True b. False Indicate whether the statement is true or false
If net exports are negative, then
a. net capital outflow is positive (indicating an inflow of capital), so foreign assets bought by Americans are greater than American assets bought by foreigners. b. net capital outflow is positive (indicating an inflow of capital), so American assets bought by foreigners are greater than foreign assets bought by Americans. c. net capital outflow is negative (indicating an outflow of capital), so foreign assets bought by Americans are greater than American assets bought by foreigners. d. net capital outflow is negative (indicating an outflow of capital), so American assets bought by foreigners are greater than foreign assets bought by Americans.