A monopoly may breed inefficiency by reducing competition and restricting production.
Answer the following statement true (T) or false (F)
True
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An individual's consumer surplus is the difference between the maximum price that she or he is willing to pay and the actual price.
Answer the following statement true (T) or false (F)
Suppose that if a local McDonald's restaurant reduces the price of a Big Mac from $4.00 to $3.25, the number of Big Macs it sells per day will increase from 4 to 5. Explain the output effect and the price effect resulting from this change
Using a graph, illustrate both the loss in revenue from selling each of the first 4 Big Macs for $0.75 less and the additional revenue from selling 1 more Big Mac. What is the total change in revenue received which results from this price decrease?
If you sell a futures contract for U.S. Treasury bills and on the delivery date the interest rate of T-bills is higher than you expected, you will have
A) lost money on your long position. B) gained money on your long position. C) lost money on your short position. D) gained money on your short position.
For an aggregate demand curve with = 10% and = 0%, if inflation is 6%, then real growth is:
What will be an ideal response?