Which of the following is a characteristic of a monopoly?
a. a large number of sellers
b. homogeneous products
c. large barriers to entry
d. price taking firms
c
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Suppose a monopolist chooses to advertise its good and its own demand curve shifts to the right, then we know that
a. the industry's demand curve shifts in precisely the same way b. its competitors share some of the benefits of the advertising c. the monopolist's cost curves will shift to accommodate the shift in demand d. the price of substitute goods will fall e. consumers are turned off by the advertising and buy less at every price
Refer to the accompanying figure. Suppose the solid line shows the demand for coffee. If coffee and tea are substitutes, and the price of tea falls, then you would expect:
A. an increase in the quantity of coffee demanded, but no shift in the demand curve. B. a decrease in the quantity of coffee demanded, but no shift in the demand curve. C. the demand curve to shift to D(B) D. the demand curve to shift to D(A).