If a Contestable Market Has Only One Seller, Which of the Following

question 71

Multiple Choice

If a contestable market has only one seller, which of the following will keep the seller from producing inefficiently and charging a price that generates long-run economic profits?

• A) government regulations
• B) low costs of entry into and exit from the market
• C) substantial economies of scale that provide a competitive advantage to large firms in such markets
• D) the threat of a government takeover of the firms in these markets

Understand Thorndike's contributions to psychology and the principle of the law of effect.

Recognize the process of classical conditioning and its effects on behavior.

Differentiate between classical and operant conditioning.

Identify the role of reinforcement in learning and behavior modification.

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