How does a natural monopoly differ from a legal monopoly?
What will be an ideal response?
The barrier to entry protecting a natural monopoly is the firm's cost. For a natural monopoly, the costs are such that one firm can supply the entire market at lower cost than could two or more firms. The barrier to entry protecting a legal monopoly is a legal prohibition preventing competitors from entering the market. Copyrights, patents, government licenses, and public franchises are legal barriers to entry.
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Sergio's rentals of Blu-ray movies increase by 10 percent when her income increases by 30 percent. Based on this information, we know that for Sergio, Blu-ray movies
A) are complements. B) are substitutes. C) are inferior goods. D) have an inelastic demand. E) are normal goods.
A rightward shift in the money supply curve is likely to produce a rightward shift in the money demand curve
a. True b. False Indicate whether the statement is true or false