Government regulation in the form of subsidies, tariffs, licensing, and inspections does which of the following?
(a) Creates rents for businesses
(b) Offers profits to some businesses at the expense of others
(c) Encourages the inefficient use of productive resources
(d) All of the above
(d)
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Which of the following statements regarding the efficiency of monopolistic competition is FALSE?
A) Compared to a situation with total product uniformity, monopolistic competition might be efficient. B) Resources are used efficiently when marginal social benefits equals marginal social cost. C) Monopolistic competition is definitely inefficient because price exceeds marginal cost. D) A greater degree of product variety creates a loss because the quantity produced is less than the efficient quantity.
"When the cost of producing a unit of a good falls because the firm uses specialized resources to produce a range of goods and services" is the definition of
A) economies of scope. B) economies of scale. C) economic efficiency. D) technological efficiency.