Refer to the above graph. The level of output at which this firm is maximizing an economic profit is:
A. 0K.
B. 0B.
C. 0C.
D. 0A.
Answer: C
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Relative to a monopolist charging a single price to all consumers, price discrimination ________ total economic surplus.
A. sometimes increases and sometimes decreases B. decreases C. has no effect on D. increases
Refer to Figure 4-18. What is the size of the unit tax?
A) $8 B) $5 C) $3 D) cannot be determined from the figure
Suppose an excise tax is imposed on two products X and Y, both of which have identical supply elasticities. The demand for good X is highly elastic, while the demand for good Y is highly inelastic. The deadweight loss (or excess burden) will be
a. equal in both cases. b. larger for good X than good Y. c. larger for good Y than good X. d. zero in both cases.
Monopolistic competition is the only market structure that features many sellers
a. True b. False Indicate whether the statement is true or false