A regulatory agency concerned with "universal service" must
a. prevent high profits in all markets.
b. prevent entry in high-profit markets.
c. prevent cross-subsidization.
d. guarantee marginal cost pricing.
b
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Players in all of the following games have no dominant strategy except in
A) a prisoner's dilemma game. B) a pure coordination game. C) an assurance game. D) a battle of the sexes game.
Which of the following is a possible explanation for the fall in prices after an industry is monopolized by combining a group of competitors?
a. A monopolist faces a downward sloping demand curve. Hence, output expansion leads to lower prices. b. A reduction in price increases producer surplus. Hence a monopolist may reduce the price of his product. c. A monopolist may reduce prices to make it difficult for other firms to compete. d. A monopolist can increase profits by reducing price when its cost of production declines due to increased size of the new firm. The fall in price is less than the decline in cost.
Which of the following arguments is not used by promoters of globalization as one of the reasons why free trade and international investment result in higher standards of living?
a. Free trade helps developing countries. b. International organizations represent governments and people, not the interests of corporations. c. There is no convincing evidence that globalization occurs at the expense of the environment. d. There is no convincing evidence that globalization occurs by encouraging harmful labor practices. e. Globalization brings better cultural practices to countries that have obsolete cultural traditions.
To stop a speculative attack interest rates must be ________, which will ________ aggregate demand.
A. increased; increase B. decreased; decrease C. increased; decrease D. decreased; increase