Why is the monopoly total welfare lower than the competitive total welfare?
What will be an ideal response?
A monopoly restricts output relative to the competitive level. This generates a deadweight loss. Consumers value the units the monopolist does not produce more than the cost of producing those units. Thus, total welfare is lower with a monopolist.
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Preferred Budgets ($ in millions)45678910Number of voters (in thousands)516253022193Table 15.3Table 15.3 shows the preferred budget for a new performance center and the number of voters in a community who prefer that budget. If Dawn proposed $6 million while Terry proposed $9 million, whose budget will be selected if everyone votes?
A. Dawn's B. Terry's C. It is a tie. D. The outcome cannot be predicted.
If the aggregate supply curve is horizontal,
A. there are unemployed resources. B. the economy is inside the production possibilities frontier. C. it is possible to increase output, without driving up prices, by putting unemployed resources to work. D. All of the choices are correct.
Answer the following statements true (T) or false (F)
1) In the United States, real GDP per capita has increased more rapidly than real GDP. 2) An economy with an average growth rate of 10 percent can expect to see its real GDP double in approximately 7 years. 3) Growth is a widely held economic goal primarily because it creates a more equal distribution of wealth and income. 4) Real GDP per capita is found by dividing real GDP by the size of the labor force. 5) The rule of 70 is used to find how long it will take an economy to grow by 70 percent.
The supply curve illustrates
A) the amount of a good producers plan to sell at given prices. B) the amount of a good producers need to sell at given prices. C) the corresponding demand for a good at given prices. D) the sunk costs associated with producing a scarce good.