Refer to above figure. Suppose the European government provides Airbus with a subsidy of $4 for each airplane sold, and that the subsidy convinces Boeing to exit the Hungarian market. Now Airbus would be the monopolist in this market

Explain why, in a simple economy which does not include the government or taxation, saving equals investment at the equilibrium level of output

What will be an ideal response?

The techniques of regulation used in the U.S. are

(a) meant to solve basic problems, but they create others. (b) meant to re-enforce the "decisions of the marketplace." (c) meant to manage problems rather than solve them. (d) designed to make the economy more efficient than is possible with only the free market mechanism.