Why can't the government force a natural monopolist to produce the competitive output?
What will be an ideal response?
The competitive solution would be where MC = ATC. At that point the natural monopolist is losing money and would go out of business if forced to produce there.
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If output is increased in the long-run, average production costs in the presence of internal economies of scale will ________, and in the presence of external economies of scale, will ________
A) decrease; decrease B) increase; remain constant C) remain constant; increase D) decrease; remain constant E) increase; decrease
If a monopolist wishes to increase its output and quantity sold
A) it must reduce its price, so its marginal revenue is greater than its price. B) it must reduce its price, so its marginal revenue is less than its price. C) it must raise its price, so its marginal revenue is greater than its price. D) it must raise its price, so its marginal revenue is less than its price.
An increase in the number of producers of a good will
a. increase the market supply because the price will rise b. increase the market supply only if market demand increases too c. increase the market supply because market supply is the sum of all individual supply curves d. increase the market supply only if all suppliers have an identical supply curves e. decrease the market supply because firms compete with each other and each firm will supply more
Personal consumption accounted for $12.3 billion in 2015 in the United States.
Answer the following statement true (T) or false (F)