The advantages that arise from economies of scale make entry difficult for new firms. As a result, monopolies and oligopolies are often associated with __________ and ___________
a. b and e
b. low costs; high prices
c. low costs; low prices
d. antitrust; laissez-faire
e. competition; high prices
B
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Which of the following illustrates the tragedy of the commons?
a. Overharvesting a species of fish b. Banning the use of oil and gas c. Using coal for manufacturing d. Hunting out of season
If a firm suffers an economic loss, its:
A. price is less than its marginal cost. B. price is less than its marginal revenue. C. price is less than its average total cost. D. None of these
When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
An expansionary monetary policy ________.
A. is designed to reduce aggregate demand B. shifts the aggregate supply curve to the right C. can reduce the length of a recession D. is used when the inflation rate is high