When barriers to entry are high, a monopolist (or cartel) will often be able to increase their profits by
a. expanding their output so they can increase their price.
b. reducing their output so they can raise their price.
c. expanding their output so they can lower their price.
d. reducing their output so they can lower their price.
B
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An increase in technology for producing personal computers leads to
A) an increase in the demand for personal computers. B) a decrease in the demand for personal computers. C) an increase in the supply of personal computers. D) a decrease in the supply of personal computers.
A possible market solution that a reputable firm can engage in when faced with the lemons problem is
A) to offer a warranty. B) to engage in externalities. C) to create asymmetric information. D) to use average cost pricing.
Which of the following is an example of an implicit cost? (i) the owner of a firm forgoing an opportunity to earn a large salary working for a Wall Street brokerage firm (ii) interest paid on the firm's debt (iii) rent paid by the firm to lease office space
a. (ii) and (iii) only b. (i) and (iii) only c. (i) only d. (iii) only
What does specialization in a nation lead to?
(A) International trade (B) Comparative advantage (C) Self-sufficiency (D) Absolute advantage