A new technology is discovered that results in all new cars producing 50 percent less pollution. The technology costs nothing to produce and cars do not change in price
As a result of the technology, there is a reduction in the number of visits people make to the doctor to complain of breathing difficulties. Which of the following is true? A) Real GDP decreases as a result of fewer doctor services being provided.
B) Real GDP is not affected.
C) Nominal GDP increases to reflect the improvement in the health of the population.
D) Real GDP decreases to reflect the decrease in pollution.
E) Nominal GDP does not change and real GDP increases.
A
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Charging prices closer to what consumers are willing to pay for a good
a. Reduces consumers surplus b. Increases producer surplus c. Both a and b d. None of the above
Which of the following is true for a firm that is a monopolist?
a. the firm will make an economic profit in the short run. b. the firm will produce a smaller quantity of output than what would be best from the viewpoint of ideal economic efficiency. c. the additional revenue that can be generated from an increase in output will exceed the firm's price. d. the firm can charge whatever it wants for its product since consumers have no alternatives.