Multiple..CHOICE!!?
1 - One type of monopoly that the US government presently permits is:
a - the telephone company.
b - professional sports leagues.
c - low-price gasoline.
d - certain kinds of medications.
2 - A situation in which the market behaves inefficiently is when:
a - consumers do not have enough information to make good choices.
b - producers have the power to find out exactly what to produce.
c - both consumers and producers are fully informed about a product.
d - the market is in perfect competition and prices are high.
3 - When economic activity is conduced outside of government regulation, it is considered:
a - legal as long as consumers are protected.
b - legal as long as taxes are paid.
c - illegal because that laws of supply and demand do not apply.
d - illegal because the government cannot collect taxes or regulate the business in the public's interest.
thank you!
Answer:
1.b. Professional baseball is exempt from anti-trust laws.
2.a. One of the requirements of a free market is full and free information.
3. d. I think I answered this already. I will go with d because in the U.S. the government has a general right to regulate commerce. You could argue "b" as an answer but my response would be would about making whiskey, prostitution or selling automatic weapons. One could operate an escort service and pay taxes but this would not make it legal.
1) A The telephone company is a "natural monopoly." The cost to run additional lines for another company to enter the phone market is high and would be a waste of resources. So one phone company in a region is allowed and regulated.
2) A One of the assumptions of a perfect competitive market is that there is perfect information; information about price, how much to produce, what goods are being sold, etc. Without that the market is inefficient.
3) B? Government tends to only regulate businesses that are consider monopolies. So my guess would be B.
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11. Refer to the above diagram for a monopolistically competitive firm. If more firms would enter the industry
Economics.. Can you please explain this statement?
a - the telephone company.
b - professional sports leagues.
c - low-price gasoline.
d - certain kinds of medications.
2 - A situation in which the market behaves inefficiently is when:
a - consumers do not have enough information to make good choices.
b - producers have the power to find out exactly what to produce.
c - both consumers and producers are fully informed about a product.
d - the market is in perfect competition and prices are high.
3 - When economic activity is conduced outside of government regulation, it is considered:
a - legal as long as consumers are protected.
b - legal as long as taxes are paid.
c - illegal because that laws of supply and demand do not apply.
d - illegal because the government cannot collect taxes or regulate the business in the public's interest.
thank you!
Answer:
1.b. Professional baseball is exempt from anti-trust laws.
2.a. One of the requirements of a free market is full and free information.
3. d. I think I answered this already. I will go with d because in the U.S. the government has a general right to regulate commerce. You could argue "b" as an answer but my response would be would about making whiskey, prostitution or selling automatic weapons. One could operate an escort service and pay taxes but this would not make it legal.
1) A The telephone company is a "natural monopoly." The cost to run additional lines for another company to enter the phone market is high and would be a waste of resources. So one phone company in a region is allowed and regulated.
2) A One of the assumptions of a perfect competitive market is that there is perfect information; information about price, how much to produce, what goods are being sold, etc. Without that the market is inefficient.
3) B? Government tends to only regulate businesses that are consider monopolies. So my guess would be B.
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