Under rate-of-return regulation, the price is set so that
A) price equals the marginal cost of production.
B) the firm earns a positive economic profit.
C) the firm earns a monopoly profit.
D) the firm earns a normal rate of return on investment.
D
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Which of the following is NOT correct regarding the theories of income distribution?
A) Dealing with how income ought to be distributed is a normative issue. B) The productivity standard for the distribution of income is stated "to each according to what they produce." C) The egalitarian principle of income distribution is "to each exactly the same." D) Dealing with how income should be distributed is a positive economic issue.
Which of the following will cause an increase in consumer surplus?
a. an increase in the production cost of the good b. a technological improvement in the production of the good c. a decrease in the number of sellers of the good d. the imposition of a binding price floor in the market