Suppose the larger firm of a duopoly has sales of $900 million and the smaller firm has sales of $100 million. The market share of the larger firm is
A. 90 percent.
B. 80 percent.
C. 20 percent.
D. 10 percent.
Answer: A
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A difference between a perfectly competitive industry and a monopoly is that
A) in the long run, firms in a perfectly competitive industry make zero economic profit and a monopoly can make an economic profit. B) a firm in a perfectly competitive industry can perfectly price discriminate but a monopoly cannot. C) only monopolies have an incentive to maximize profit. D) perfectly competitive firms can have a public franchise. E) a barrier to entry protects perfectly competitive firms in the short run and protects a monopoly in the long run.
The greater the price elasticity of market demand, the less will be the reduction in market output from a price floor.
Answer the following statement true (T) or false (F)
The cost of producing one more pizza is the
A) price. B) marginal benefit. C) marginal cost. D) producer surplus.
The figure above shows the costs and demand curves for the Bigshow Cable Company. To avoid any deadweight loss in the market served by Bigshow, the regulator must set the price at
A) $8. B) $6. C) $4. D) $2.