Agricultural subsidies in the United States are paid for by

Agricultural subsidies in the United States are paid for by
 a. consumers of the product
  b. taxpayers and consumers
  c. other industries
  d. special taxes
  e. import tariffs

QUESTION 2

Monopolistically competitive firms do not achieve allocative efficiency in the long run because
 a. marginal cost equals marginal revenue
  b. marginal cost is greater than marginal revenue
  c. marginal cost is less than marginal revenue
  d. price is less than marginal cost
  e. price is greater than marginal cost

QUESTION 3

It is not likely that the costly special-interest farm price supports will be replaced by more efficient direct transfer payments because
 a. farming would cease
  b. such a proposal would attract public attention and threaten the survival of the program
  c. the private gains from price supports exceed the costs to society
  d. a direct transfer program would require too much paperwork
  e. consumers favor the current legislation

QUESTION 4

Which of the following is unique to perfect competition?
 a. The individual firm cannot earn economic profit in the long run.
  b. It is easy for new firms to enter the industry.
  c. The market demand curve slopes downward.
  d. The demand curve facing an individual firm is perfectly elastic.
  e. The firms in the industry produce a homogeneous product.

QUESTION 5

Legislators often have difficulty passing legislation with widespread benefits, but that imposes concentrated costs because those who bear the costs will __________ the legislation, while those who would reap the benefits will __________ the legislation.
 a. protest; actively support
  b. not protest; not actively support
  c. not protest; actively support
  d. protest; not actively support
  e. protest; protest

QUESTION 6

Excess capacity typically occurs
 a. in the short run in perfect competition
  b. in the short run in monopolistic competition
  c. in long-run equilibrium in perfect competition
  d. in long-run equilibrium in monopolistic competition
  e. usually in markets experiencing an increase in demand

QUESTION 7

Competing-interest legislation is legislation that
 a. imposes benefits on only a few individuals but imposes costs on many people
  b. imposes both benefits and costs on relatively few individuals
  c. imposes benefits on many individuals but imposes the costs on relatively few people
  d. imposes both benefits and costs on many individuals
  e. imposes costs only on those individuals who are rationally ignorant