In spring 2008, the U.S. Congress proposed to tax oil companies because of their near-monopoly status. This could have the unintended consequence of
A) increasing the equilibrium price by more than the tax.
B) destroying the oil companies and leaving the United States without oil.
C) increasing the profit of the best oil company.
D) decreasing the power of the U.S. Congress.
A
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Which of the following undermines the effectiveness of a barrier to entry?
a. the existence of patents in the industry b. high fixed cost c. no access to resources d. product differentiation e. rapid technological innovation
The long run refers to a time period
A) during which a firm is able to purchase all of its inputs, including its plant and equipment. B) long enough for a firm to vary all of its inputs, to adopt new technology, and change the size of its physical plant. C) long enough for a firm to pay all of its creditors in full. D) long enough for a firm to change the use of its variable inputs.