A natural monopoly:
a. is a monopoly in the production of raw materials.
b. occurs when one firm can supply the entire market more cheaply than can a number of firms.
c. is one result of a patent.
d. necessarily involves inefficient pricing.
b
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Indicate whether the statement is true or false
Why do nations impose trade barriers, such as those instituted during the Great Depression, that make it difficult for their own citizens to trade with people in other countries?
a. Trade restrictions are a good way for a country to increase the total employment and income level of its citizens. b. As the experience during the 1930s illustrates, trade restrictions are an effective way to increase exports and tax revenues. c. Trade restrictions provide gains to domestic residents at the expense of foreigners. d. Trade restrictions often provide benefits to highly visible special interest groups while imposing a less visible cost on the general populace.