Because the smallcountry monopolist loses the ability to control the market price, consumers enjoy more quantity, competitive prices, and:
a. a bonus because the foreign goods are of higher quality.
b. a loss because the monopoly loses profits.
c. higher consumer surplus because the monopolist's producer surplus is reduced.
d. a loss because now unions have less power than before.
Ans: c. higher consumer surplus because the monopolist's producer surplus is reduced.
You might also like to view...
What can explain the fact that DVD players decreased in price during the 1990s even as more DVD players were being sold?
A) The demand for DVDs was declining. B) The supply of DVD players was decreasing. C) The supply of DVD players was increasing more than the demand for DVD players. D) The demand for DVD players was increasing more than the supply of DVD players.
A bond is
A) a legal claim to a part of a corporation's future profits that includes voting rights. B) a legal claim to a part of a corporation's future profits that does not include voting rights. C) a legal claim against a firm, providing a fixed annual coupon payment and a lump-sum payment at maturity. D) a nonlegal promise to provide an annual payment to the holder when the corporation makes profits.