What is meant by the "law of one price"?
A) A law was passed in 1913 that made it illegal to sell the same good or service to different people for different prices.
B) This is a section of the Sherman Act that forced trusts (for example, the Standard Oil Company) to charge the same price for the same good or service in different states.
C) Foreign companies should not be allowed to sell a product in the United States for prices different from prices these companies charge in other countries.
D) Identical products should sell for the same price everywhere.
D
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When a government taxes the sale of beer, cooperative surplus ________ and society gets ________
A) increases; richer B) increases; poorer C) decreases; richer D) decreases; poorer
A firm decreases its scale of operation and discovers that its long-run average costs decrease. Which of the following does this indicate?
A) Labor's marginal product has increased. B) Diseconomies of scale were absent in the larger plant. C) The firm's scale initially was so large that it experienced diseconomies of scale. D) The firm's scale initially was too small to experience economies of scale. E) Its long-run marginal cost was smaller with the larger plant than with the smaller plant.