When a second firm enters a monopolist's market:
A. the former monopolist's average cost decreases as its output level decreases.
B. the demand curve facing the former monopolist shifts to the right.
C. the market price falls.
D. None of these
Answer: C
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A consumer maximizes utility by allocating time so that the expected marginal utilities of the last unit of time spent in each activity are identical
a. True b. False
A positive externality is present whenever: a. the social marginal benefit of an activity exceeds the private marginal benefit. b. the private marginal benefit of an activity exceeds the private marginal cost. c. the social marginal cost of an activity exceeds the private marginal cost
d. none of the above.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4Refer to Figure 2.4. The economy moves from Point E to Point B. This could be explained by
A. a change in society's preferences for hybrid cars versus motorcycles. B. an increase in economic growth. C. an increase in unemployment. D. a reduction in unemployment.
Public policy can reduce frictional unemployment
a. True b. False Indicate whether the statement is true or false