Objections to monopolies do not include which of the following?
a. They reduce output below the efficient level of output that would be produced in perfect competition.
b. They reduce the price below what would be charged in perfect competition.
c. They charge a price that is greater than marginal cost.
d. They create a welfare cost.
e. All of the preceding are objections to monopolies.
Ans: b. They reduce the price below what would be charged in perfect competition.
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Which of the following statements about the importance of trade to the U.S. economy is true?
A) Overall, about 80 percent of U.S. manufacturing jobs depend directly or indirectly on exports. B) The United States is the second largest exporter in the world. C) The U.S. economy is highly dependent on international trade for growth in its gross domestic product. D) Since 1950, both exports and imports have steadily decreased as a fraction of U.S. gross domestic product.
In the consumption function C = a + c(Y - T), induced consumption is
A) a + c(Y - T). B) a + cY. C) cY. D) c(Y - T).