The rationale behind patents is that if inventors and artists cannot secure the returns from successful projects, fewer new inventions and works of art will be produced
Indicate whether the statement is true or false
QUESTION 2If an infant industry truly has a good chance to become competitive and produce profitably once it is well established, it is not at all clear that government should even offer protection to reduce short-run losses.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 3The governmental interference with the market exchange often reduces the total surplus.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 4A monopolist can sell 20 units a week at a price of 10 per unit. To sell 21 units a week, it would have to lower its price to 9 per unit. The marginal revenue of the 21st unit would be:
a. 9.
b. -11.
c. -12.
d. -20.
QUESTION 5Protecting infant industries from foreign competition may make sense, but only until the industry matures.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 6In an equilibrium in otherwise identical markets, producer surplus is higher for a monopolist than for a competitive firm.
Indicate whether the statement is true or false
QUESTION 7The theory of the long-run in perfect competition helps to provide a rationale for the belief in a limited role for government in society.
a. True
b. False
Indicate whether the statement is true or false
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