The invention of a machine that increases milk production is discovered. If farmers were to decry the effect of this new technology on the price of milk and lobby government to set the price of milk at the price before the invention, what would be the result?
A. A decline in the price of milk
B. Excess demand for milk
C. Excess supply of milk
D. Neither a shortage nor a surplus of milk
Answer: C
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A single-price monopoly maximizes profit by producing the quantity at which _____
A. its total revenue will be as large as possible B. marginal revenue equals marginal cost and setting the price equal to marginal revenue C. marginal revenue equals marginal cost and setting the price equal to marginal cost D. marginal revenue equals marginal cost and setting the price equal to the most people are willing to pay for that quantity
Refer to Figure a. Charlie and Joe both want to ride shotgun with their mother, so they play a game of rock-paper-scissors to determine who gets to sit in the front seat. In the table, -1 represents a loss, 1 a win and 0 a tie, and Joe's payoff is shown in the upper left-hand corner of each cell, while Charlie's appears in the lower right-hand corner. What is the Nash equilibrium?
A. Charlie chooses rock, Joe chooses rock
B. Charlie chooses rock, Joe chooses paper
C. Charlie chooses paper, Joe chooses scissors
D. There is no Nash equilibrium.
Deadweight losses are associated with monopolistic competition:
a. In the short run, but not the long run b. In the long run, but not the short run c. In both the short and long run d. In neither the short run nor the long run
A shift in the demand curve to the right represents
A) an increase in demand. B) a decrease in demand. C) an increase in quantity demanded. D) a decrease in quantity demanded.