The monopolist's outcome in the long run differs from that of the perfectly competitive firm in that it:
A. charges a price where marginal costs equal average revenue.
B. charges a price above average total costs.
C. has zero profits in the long run.
D. charges a price equal to MC.
Answer: B
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Refer to the above figure. The top two arrows of the figure refer to the product markets. The bottom arrows refer to the factor markets. Which arrow represents total income?
A) Arrow A B) Arrow B C) Arrow C D) Arrow D
If the balance on the current account is zero, which of the following transactions will cause it to go into deficit?
a. The Moscow Capital Investment Corporation makes a loan to a US firm b. A US subsidiary exports raw materials to its French parent company c. US firms and individuals receive dividends on US investments in Latin America d. US tourists in Great Britain purchase pounds sterling e. Foreigners purchase US securities