Of the following, consumer surplus is largest for
A) a perfectly competitive industry.
B) a single-price monopoly.
C) any price-discriminating monopoly.
D) a perfectly price-discriminating monopoly.
Ques. 2Increasing marginal returns means that as the firm expands its output, its
A) long-run average total cost increases.
B) long-run average total cost decreases.
C) short-run average total cost increases.
D) short-run average total cost decreases.
Ques. 3It is clear from the theory of monopolistic competition that product development is not pushed to its efficient level. This statement is
A) false because there is so much product differentiation in monopolistic competition.
B) true because there is little incentive to innovate in monopolistic competition.
C) false because there are so many wasteful innovations in monopolistic competition that are merely cosmetic.
D) true because price exceeds marginal revenue in monopolistic competition.
Ques. 4Left unregulated, the equilibrium amount produced in the market described in the table above is
A) 550 units.
B) 600 units.
C) 650 units.
D) 700 units.
Ques. 5Buyers receive a consumer surplus when the price exceeds the marginal benefit.
Indicate whether the statement is true or false
Ques. 6Rent controls and the minimum wage are both examples of price ceilings.
Indicate whether the statement is true or false
Ques. 7A circular flow diagram shows the flows from the goods and resources markets.
Indicate whether the statement is true or false
Ques. 8Jake has already bought his hockey gear for the season, but when he is in the sports store, he falls in love with a different hockey stick and buys it even though it means he can't go out to dinner later with his friends which he would have preferred
. This example illustrates the ________ aspect of behavioral economics. A) bounded rationality
B) bounded self-interest
C) empowerment effect
D) bounded will-power
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