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NEW QUESTION 48
Why are prices typically higher when a firm has monopoly power than when firms are perfectly competitive?
- A. Monopolies are profit maximizing, while perfectly competitive firms are not.
- B. A competitive firm has less incentive to keep prices high on inframarginal customers.
- C. A monopolist cannot sustain profits without expanding production.
- D. Competitive firms do not have enough market power to produce where marginal revenue equals marginal cost.
Answer: B
NEW QUESTION 49
In Dec. of 2013, a company signed a promissory note and recorded a note payable of $150,000. This note is payable in three equal annual installments beginning from Dec. of 2014. How should the company report the note payable on its Dec. 31, 2013 balance sheet?
- A. $50,000 in noncurrent liability and $100,000 in current liability
- B. $50,000 in current liability and $100,000 in noncurrent liability
- C. $150,000 in current liability
- D. $150,000 in noncurrent liability
Answer: B
NEW QUESTION 50
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A manager at a large gold mining company is trying to determine how a series of recent events will affect the future of his industry.
The following events occur simultaneously:
Flooding damages several gold mines in a region.
The price of platinum, a substitute for gold, increases.
A new government policy mandates an increased wage rate for mine workers.
What should the manager expect regarding the new equilibrium price and quantity for gold?
- A. The equilibrium price increases and the effect on quantity is unknown.
- B. The effect on price is unknown, and the equilibrium quantity increases.
- C. The equilibrium price increases and equilibrium quantity increases.
- D. The equilibrium price increases and equilibrium quantity decreases.
Answer: A
NEW QUESTION 51
Which of the following options would MOST likely be considered a variable cost?
- A. The hourly wage of a student mowing lawns for a landscaping company
- B. The loan payment for a new machine at a manufacturing company
- C. The monthly salary of a manager at a telecommunications company
- D. A license to serve alcohol for a new restaurant
Answer: A
NEW QUESTION 52
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