EBK ESSENTIALS OF ECONOMICS
7th Edition
ISBN: 8220102452107
Author: Mankiw
Publisher: CENGAGE L
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Chapter 11, Problem 5QCMC
To determine
Characteristic of a public good.
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This is a form of governmental public policy that has been implemented to reduce the purchase of cigarettes and alcohol.
A.Marketing limitations
B.Raising the legal age
C.Vending machine regulations
D.Taxation
Public goods area. efficiently provided by market forces.b. underprovided in the absence of government.c. overused in the absence of government.d. a type of natural monopoly.
Compared to the social optimum, a monopoly firm chooses a. a quantity that is too low and a price that is too high. b. a quantity that is too high and a price that is too low. c. a quantity and a price that are both too high. d. a quantity and a price that are both too low.
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- An example of a barrier to entry in a market is:A. Lack of profitable opportunities.B. Increasing cost of production.C. Inelastic market demand.D. Government licensing requirement.arrow_forwardThe following statements are FALSE about market failures EXCEPT a.An efficient monopoly in allocating its resources causes a large consumer surplus. b.Price mechanism in the private market allow limited resources to be efficiently used. c.Market mechanism provide an opportunity to enter a perfectly competition market. d.Market mechanism are not the best tool to distribute resources fairly.arrow_forwardThe deadweight loss in a monopoly occurs because: A. The monopolist produces less than the socially optimal output level.B. There is perfect competition in the market.C. The monopolist is forced to produce at a loss due to government intervention.D. Consumer surplus is maximized at the monopoly price.arrow_forward
- Explain in brief. a) Why government should intervention in a monopoly market. b) Give a practical example of government intervention in the monopoly market.arrow_forwardWhich of the following is least likely to be associated with market failure, and is consequently least likely to require any form of state regulation or intervention? OA Hake fishing off the west coast of South Africa OB. The provision of education services in government schools OC The provision of education services in private schools D. The market for fast foods Fi Previeus page E s heretosarrow_forwardPlease submit the answer and then watch the video feedback.Farmer Ted sells 1,000 bushels of wheat at a price of $5 per bushel in a competitive market. Wilma sells 5 gallons of water at a price of $5 per gallon in a monopoly market. If both Farmer Ted and Wilma want to sell a higher quantity, what happens to their respective prices? a.Farmer Ted's price remains constant and Wilma's price decreases. b.Farmer Ted's price decreases and Wilma's price remains constant. c.Farmer Ted's price remains constant and Wilma's price increases. d.Both Farmer Ted's and Wilma's prices decrease.arrow_forward
- a. On a graph, show the quantity of beehives that the beekeeper will choose if there are barriers to negotiation with the orchardist and show how subsidizing beehives can lead to the efficient quantity. b. On another graph show how subsidizing honey can lead to the efficient quantity.arrow_forwardWhen governments deregulate an industry, using economic theory, explain what governments want to achieve in terms of social-well being.arrow_forwardWhich of the following is NOT an example of government intervention in the market? a. Corporate social responsibility b. Use of competition policy to prevent mergers c. Regulation prices d. Legislation banning the sale of the productarrow_forward
- In which case is there no evidence of market failure? a. Intense competition in a fruit market b. A steel plant pollutes a nearby river c. Buyers of goods are uncertain about their quality d. A monopoly maximises its profitsarrow_forwardEach of these are possible benefits from a monopoly EXCEPT A. the ability to minimize deadweight loss from production. B. potential economies of scale from production. C. more jobs in research and development. D. new innovations in technology and in the creative arts.arrow_forwardA market structure that is “monopoly” is NOT ... Group of answer choices a. production efficient b. allocation efficient c. neither allocation nor production efficientarrow_forward
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