Explain why in the case of economies of scope the production possibility frontier is bowed outward
What will be an ideal response?
With economies of scope a firm uses less resources if it produces i.e. two goods jointly instead of producing the two goods in two firms separately. This means that the firm can produce more of the two goods when the goods are produced jointly. Hence the bowed outward PPF.
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A monopoly occurs when
A) each of many firms produces a product that is slightly different from that of the other firms. B) one firm sells a good that has no close substitutes and a barrier blocks entry for other firms. C) there are many firms producing the same product. D) a few firms control the market. E) one firm is larger than the many other firms that make an identical product.
Refer to the information provided in Table 19.4 below to answer the question(s) that follow.Table 19.4Total IncomeTotal Taxes$10,000 $1,000 20,000 2,400 30,000 4,500 40,000 8,000Related to the Economics in Practice on page 393: Refer to Table 19.4. At an income level of $40,000, the average tax rate is
A. 2%. B. 5%. C. 15%. D. 20%.