Which of the following is true under natural monopoly?
a. the monopolist will ignore consumers' desires.
b. the marginal cost curve will lie below the average total cost curve.
c. the monopolist will set price equal to marginal cost and will earn economic profits.
d. output is produced under conditions of constant cost.
B
You might also like to view...
In an open economy with a given level of real interest rates and risk, a decrease in real interest rates abroad will ________ capital inflows and ________ the equilibrium domestic real interest rate.
A. increase; decrease B. decrease; increase C. decrease; decrease D. increase; increase
An economist claims that "the evidence suggests that high rates of inflation are associated with slow long-term economic growth." This is an example of
a. positive economics b. normative economics c. negative economics d. a simplifying assumption e. microeconomic analysis
Under a proportional tax, the fraction of income paid in taxes
a. rises as income rises. b. is unchanged as income changes. c. falls as income rises. d. is proportional to the change in income.
Find the efficient output level for this market.
The market for a chemical pesticide can be modeled as given below, where Q is measured in thousands of pounds: MSB = 20 – 0.4Q MPB = 20 – 0.3Q MSC = MPC = 12 + 0.1Q