Summarize the effects of a production quota on the market price and the quantity produced
What will be an ideal response?
A production quota set below the equilibrium quantity raises the price and decreases the quantity.
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Without any regulation, the natural monopolist will
A) not produce any output. B) produce to the point at which P = ATC. C) produce less output than it would if the industry was purely competitive. D) have an upward-shifting average cost curve.
In the circular flow model,
a. money flows from the firms to the households through the product market. b. money flows from the households to the firms through the product market. c. money flows from the households to the firms through the resource market. d. money flows from the households to the firms through both the product market and the resource market. e. resources flow to the households from the firms through the product market.