+
Related Flashcards
Related Topics
Cards In This Set
| Front | Back |
|
What does the market demand curve for a public good show?
|
The total value that all individuals place on each unit of the good
|
|
If some activity creates positive externalities as well as private benefits, then economic theory suggests that the activity ought to be ...
|
Subsidized
|
|
What does it mean when a product produces significant spillover costs to society?
|
Resources are overallocated to the industry
|
|
The rationale for the ability-to-pay principle asserts that...
|
The marginal utility of the dollar is greater for a poor person than for a rich person
|
|
Economic profits are calculated by subtracting...
|
Explicit and implicit costs from total revenue
|
|
The law of diminishing returns describes the...
|
Relationship between resource inputs and product outputs in the short run
|
|
What is the market model with the largest number of firms
|
Pure competition
|
|
In a purely competitive industry, each firm:
|
Can easily enter or exit
|
|
No single firm can influence the market price by changing its output is a characteristic of what market model?
|
Pure competition
|
|
What does the demand curve for a purely competitive market look like?
|
A horizontal line
|
|
What can barriers to entry result from?
|
Government regulation
|
|
When is a monopoly most likely to emerge and be sustained?
|
Economies of scale are large relative to market demand
|
|
If marginal costs decrease, a typical monopolist will:
|
Reduce price and increase quantity of output
|
|
How is a monopolistically competitive firm like a purely competitive industry?
|
Neither has significant barriers to entry
|
|
What does an oligopolistic market consistent with?
|
A small number of firms
|
