The above figure represents the cost and demand curves for a natural monopoly that is regulated using a marginal cost pricing rule
a) What is the quantity?
b) What price is charged?
c) What area represents the consumer surplus when the firm is regulated using a marginal cost pricing rule?
d) What distance represents the firm's loss per unit when the firm is regulated using a marginal cost pricing rule?
a) The quantity is the efficient quantity, Q3.
b) The price is P2.
c) When the firm is regulated using a marginal cost pricing rule, the consumer surplus is equal to the area of the triangle P1dP2.
d) The loss per unit is the amount equal to the distance cd.
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Suppose that average labor productivity in Country C is $5,000, and that Countries C and E have the same real GDP per capita. Based on the information in the table, what must be the average labor productivity in Country E?CountryPopulation (millions)Share of Population Employed (%)A10060B15055C7550D25045E9540
A. $1,500 B. $6,250 C. $4,500 D. $1,000
A geologist tells the ACME Mining Company she's certain there is a gold vein one thousand feet below the surface of its property, but ACME still decides not to mine for that gold. How would an economist explain their decision?
A) The owners of ACME aren't as greedy as other mining operations. B) The owners of ACME probably distrust the geological reports. C) The owners of ACME feel the additional costs of mining for gold outweigh the additional benefits. D) The owners of ACME are ignorant of the basic principles of economics.
The _____ allows voters to vote on a series of marginally smaller quantities of a good
a. committee version of the medium voter model b. representative democracy version of the medium voter model c. referendum version of the medium voter model d. cyclical majority
If average cost is positive
A) marginal cost equals average cost. B) marginal cost exceeds average cost. C) marginal cost is less average cost. D) Not enough information is given.