In the short run, a monopolist will always shut down when
a. total cost is greater than total revenue at all output levels
b. total variable cost is greater than fixed cost
c. total revenue is greater than total variable cost at all output levels
d. fixed cost is greater than total revenue at all output levels
e. total variable cost is greater than total revenue at all output levels
E
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What effect would a reduction in the U.S. selling price of Japanese-made cars have on the U.S. demand for American-made cars?
A) No effect, because price changes affect quantity demanded, not demand. B) The demand would decrease. C) The demand would increase. D) We cannot tell unless we know the elasticities of demand for Japanese-made and American-made cars. E) We cannot tell unless we know what happened to the price of American-made cars.
Which is a screen against adverse selection
a. Insurance companies require homeowners to have smoke detectors b. Rearview cameras in cars c. Installing engine monitors to track driving habits of the insured d. Prospective secretaries must take a typing test before being hired