Questions from General Economics

Q: True or False. Larger MPCs imply larger multipliers.

True or False. Larger MPCs imply larger multipliers.

Q: How often do perfectly competitive firms engage in price discrimination?

How often do perfectly competitive firms engage in price discrimination? a. Never. b. Rarely. c. Often. d. Always.

Q: Suppose that a monopolist can segregate his buyers into two different groups

Suppose that a monopolist can segregate his buyers into two different groups to which he can charge two different prices. In order to maximize profit, the monopolist should charge a higher price to t...

Q: The socially optimal price (P = MC) is socially optimal

The socially optimal price (P = MC) is socially optimal because: a. It reduces the monopolist’s profit. b. It yields a normal profit. c. It minimizes ATC. d. It achieves allocative efficiency.

Q: The main problem with imposing the socially optimal price (P =

The main problem with imposing the socially optimal price (P = MC) on a monopoly is that the socially optimal price: a. May be so low that the regulated monopoly can’t break even. b. May cause the re...

Q: Relate opportunity costs to why profits encourage entry into purely competitive industries

Relate opportunity costs to why profits encourage entry into purely competitive industries and how losses encourage exit from purely competitive industries.

Q: Suppose a pure monopolist is faced with the demand schedule shown below

Suppose a pure monopolist is faced with the demand schedule shown below and the same cost data as the competitive producer discussed in problem 4 at the end of Chapter 10. Calculate the missing total-...

Q: Suppose that a price-discriminating monopolist has segregated its market into

Suppose that a price-discriminating monopolist has segregated its market into two groups of buyers. The first group described by the demand and revenue data that you developed for problem 1. The dema...

Q: Assume that the most efficient production technology available for making vitamin pills

Assume that the most efficient production technology available for making vitamin pills has the cost structure given in the following table. Note that output is measured as the number of bottles of vi...

Q: A new production technology for making vitamins is invented by a college

A new production technology for making vitamins is invented by a college professor who decides not to patent it. Thus, it is available for anybody to copy and put into use. The TC per bottle for produ...