Public goods are distinguished by two primary characteristics. What are they?
A) nonrivalry and nonexcludability B) market failure and high prices
C) government intervention and low prices D) rivalry and exclusivity
A
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Budget constraints exist for consumers because
a. their utility from consuming goods eventually reaches a maximum level b. even with unlimited incomes, they have to pay for each good they consume c. they have to pay for goods and they have limited incomes d. prices and income are inversely related e. demand curves for goods generally slope downward
Explain the difference between the short run and the long run.
What will be an ideal response?
Some markets have many buyers and sellers but fall into the category of monopolistic competition rather than perfect competition. The most common reason for this is
A) there are high barriers to entering these markets. B) firms in these markets sell identical products. C) firms in these markets make high profits. D) firms in these markets do not sell identical products.
If a monopolist is producing a rate of output at which market demand is inelastic,
a. it may or may not be maximizing its short-run profit b. reducing output would reduce both total revenue and total cost c. reducing output would increase both total revenue and total cost d. reducing output would increase total revenue and reduce total cost e. increasing output will increase its short-run economic profit