Critics of industrial regulation say that such regulation:
A. benefits small firms at the expense of large firms.
B. perpetuates monopoly long after new technology has eroded natural monopoly.
C. creates insurmountable principal-agent problems.
D. has resulted mainly from the paradox of voting.
Answer: B
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When a Pigouvian tax is imposed, ________
A) the marginal private cost curve shifts upward B) the demand curve shifts rightward C) the marginal social cost curve shifts downward D) the marginal social benefit curve shifts downward
Which of the following signals a normative economic statement?
a. is b. has been shown to be c. should be d. can be e. is more than
In the above figure, if we start at AD1 and SRAS1, and the money supply increases unexpectedly, what causes the economy to get to the long-run equilibrium?
A. People's expectations will revise after a short-run gain in output, wages will rise, and SRAS will shift rightward. B. People's expectations will revise after a short-run loss in output, wages will fall, and SRAS will shift leftward. C. People's expectations will revise after a short-run gain in output, wages will fall, and SRAS will shift leftward. D. People's expectations will revise after a short-run gain in output, wages will rise, and SRAS will shift leftward.
When the marginal revenue product of an input is less than its price, the
A. producer should expand the use of that input. B. price of the input will automatically rise in a free market. C. producer should reduce the use of that input. D. marginal physical product of that input must be below its average physical product.