Ameritech Has a Monopoly Over Local Telephone Service

question 101

Multiple Choice

Ameritech has a monopoly over local telephone service. If Ameritech is producing where marginal revenue is less than marginal cost, the firm

• A) could increase profits by reducing output.
• B) could increase profits by increasing output.
• C) is maximizing profits.
• D) must be earning a zero profit.

Understand the significance of market valuation ratios including P/E ratio, market/book ratio, and calculate them.

Understand the definition and scope of sociology as a systematic and scientific study of human society and social behavior.

Recognize the weaknesses and limitations of the sociological approach and the everyday actor perspective.

Grasp the concept of sociological imagination and its significance in connecting individual experiences with larger social and historical forces.

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Definitions:

Microeconomics

The part of economics concerned with (1) decision making by individual units such as a household, a firm, or an industry and (2) individual markets, specific goods and services, and product and resource prices.

Aggregates

A broad category of coarse to medium-grained particulate material used in construction, including sand, gravel, crushed stone, slag, and recycled concrete.

Opportunity Cost

Opting for one opportunity causes the relinquishment of possible gains from not selected alternatives.

Production Possibilities Curve

The Production Possibilities Curve (PPC) is a graphical representation that shows the maximum quantity of two goods or services that can be produced with limited resources.