Assume the market is in equilibrium in the graph shown at demand D and supply S2. If the supply curve shifts to S1, and a new equilibrium is reached, which of the following is true?
A. Producer surplus would decrease, and total surplus would decrease.
B. Producer surplus would increase, and total surplus would increase.
C. Producer surplus would increase, and total surplus would decrease.
D. Producer surplus would decrease, and total surplus would increase.
Answer: A
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If an industry is a natural monopoly and regulators decide that the firm must price at marginal cost, then consumers will be ________ off than if the firm was unregulated and the firm's owners will be ________ off than if it was unregulated
A) better; better B) better; worse C) worse; better D) worse; worse
Which of the following is most likely to lead to a decrease of 10% in the nominal demand for money?
A) An increase in real income of 5% B) A decrease in real income of 5% C) A decline of 10% in the price level D) An increase of 10% in the price level
Sam, who owns a carpentry shop, discovered that with 4 laborers he could produce 18 cabinets per day. With 5 laborers he produced 25 cabinets and with 6 laborers he produced 36 cabinets. What was the MPP of the 6th laborer?
A) 11 cabinets B) 7 cabinets C) 36 cabinets D) 9 cabinets
What are government owned or government regulated monopolies called?
a. legislative monopolies b. unregulated monopolies c. public utilities d. none of the above