Refer to Figure 12-11. If this is a constant-cost industry, what is the market price in the long-run equilibrium?
A) $5 B) $14 C) $15 D) $20
B
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In the figure above, when the quantity of milk produced is 600 gallons per day, what is the deadweight loss?
A) $250 B) $125 C) $500 D) $50
Above a certain income, the marginal social security tax drops to zero.
Answer the following statement true (T) or false (F)
Which of the following market structures describe an industry in which a group of firms formally agree to control prices and output of a product?
a. Perfect competition b. Oligopoly c. Cartel d. Monopoly
If a regulatory commission wants to establish a socially optimal price for a natural monopoly, it should select a price:
A. at which the marginal cost curve intersects the demand curve. B. at which marginal revenue is zero. C. at which the average total cost curve intersects the demand curve. D. that corresponds with the equality of marginal cost and marginal revenue.