In the figure above, if the firm is regulated using a marginal cost pricing rule, the deadweight loss created is equal to the area of
A) ABG.
B) BEFG.
C) BCFG.
D) BCE.
E) None of the above because there is no deadweight loss created.
E
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The table above lists the market shares of the twenty makers of personal computers. Based upon the Herfindahl-Hirschman Index for this industry, the Justice Department would
A) regard the industry as highly concentrated. B) be against any two firms merging. C) consider the market oligopolistic. D) regard the industry as competitive.
Stabilization policy refers to attempts to
A) shift the AD curve to smooth short-run fluctuations in output. B) shift the SRAS curve to smooth short-run fluctuations in output. C) shift the AD curve to keep the price level as low as possible. D) shift the SRAS curve to keep the nominal interest rate as low as possible.