AT&T is an example of a business that used market power to
A. avoid government regulation.
B. squash the competition.
C. invest in important research benefiting society.
D. minimize average costs of production.
Answer: C
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The most important function of middlemen is to
A) act as marketing agents for producers. B) expand the number of jobs in the economy. C) produce valuable information and lower transaction costs. D) protect consumers from exploitation. E) stand between buyers and sellers to control markups.
For a natural monopoly to exist
A) a firm must continually buy up its rivals. B) a firm must have a government-imposed barrier. C) a firm's long-run average cost curve must exhibit diseconomies of scale beyond the economically efficient output level. D) a firm's long-run average cost curve must exhibit economies of scale throughout the relevant range of market demand.