Which of the following statements about monopoly is not correct?
a. In order for a monopoly to persist, there must be barriers to the entry of other firms.
b. When a monopolist increases production, the quantity effect will tend to increase total revenue and the price effect will tend to decrease total revenue.
c. A monopolist can sell as much as it wants at whatever price it chooses.
d. Because a monopoly has market power, it will charge a price higher than what would prevail under conditions of perfect competition
Answer: c. A monopolist can sell as much as it wants at whatever price it chooses.
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Other things constant, which person is willing to save more?
A) One that has a higher rate of time preference B) One that has a lower rate of time preference C) One that has no rate of time preference D) One that has no consideration about the value of goods now and in the future
Suppose the price level this year is 150 and the price level last year was 125. The inflation rate between last year and this year was
A) 20 percent. B) 2 percent. C) 16.6 percent. D) 1.6 percent.