Antitrust action restructures a previously monopolized industry into a competitive industry. If economies of scale are unimportant in the industry, the expected result of this movement from monopoly to competition is
a. a reduction in output and an increase in price in the industry.
b. a reduction in both price and output in the industry.
c. an increase in both price and output in the industry.
d. an increase in output and a reduction in price in the industry.
D
Economics
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Comment on the following statement: "For a monopolist, marginal revenue is always equal to price."
What will be an ideal response?
Economics
A $100 billion increase in government purchases would:
a. increase AD by $500 billion if MPC = 0.8. b. decrease AD by $300 billion if MPC = 2/3. c. decrease AD by $200 billion if MPC = 0.9. d. decrease AD by $40 billion if MPC = 0.4.
Economics