Answer the following statements true (T) or false (F)
1. Market demand and the firm’s demand curve coincide in a monopoly.
2. The AR and MR curves of a monopoly are identical.
3. A monopoly can sell all that it desires at any given price.
4. The demand for the product of a monopolist is perfectly inelastic.
5. A monopoly cannot suffer a loss.
1. TRUE
2. FALSE
3. FALSE
4. FALSE
5. FALSE
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If the firm in Figure 17-4 above maintains its set price of P0, rather than dropping price to P1, this reduces its profit by
A) K - G. B) K + G. C) G - K. D) G + H. E) G.
Keynesian economics
a. affirms the classical economists' basic premise concerning competitive markets b. believes that monopolies and unions tend to be permanent fixtures in our economy and the prices they create tend to be flexible, at least downward c. emphasizes that an economy can never be in equilibrium at less than full employment d. prefers to emphasize aggregate supply over aggregate demand e. believes that unemployment results when aggregate demand is insufficient to reach a full-employment level of real GDP