What is the social cost of a monopoly? Explain
What will be an ideal response?
The social cost of a monopoly comes from the fact that, in order to maximize profits, the monopolist in the market charges a higher price and produces a lower output rate as compared to a perfectly competitive situation. As a result, consumers pay a price that exceeds the marginal cost of production, and the lower production rate represents a resource misallocation.
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Assuming all else equal, a decrease in the real interest rate will cause:
A) an upward movement along the credit supply curve. B) a downward movement along the credit supply curve. C) the credit supply curve to shift to the right. D) the credit supply curve to shift to the left.
As the economy moves down and to the left along a short-run aggregate supply curve, it: a. moves up and to the right along the short-run Phillips curve. b. moves up and to the left along the short-run Phillips curve
c. moves down and to the left along the short-run Phillips curve. d. moves down and to the right along the short-run Phillips curve.
Which of the following students would be most likely to drop out of college before completing their degree?
a. a senior physics major with a solid B average b. a junior secondary education major who has just read about the substantial improvement in the job opportunities available for teachers with a college degree c. an outstanding baseball player in his junior year that just received a $500,000 offer from a professional team d. a junior economics major who wants to attend law school
The nominal rate of interest is the difference between the real rate and the expected rate of inflation.
Answer the following statement true (T) or false (F)