If Market Failure from Monopoly Behaviour Is Deemed Small Compared

question 88

Multiple Choice

If market failure from monopoly behaviour is deemed small compared to the inevitable imperfections of policies, policymakers may choose to:

• A)do nothing at all
• B)regulate the prices that the monopoly charges
• C)use competition laws to try to make the industry more competitive
• D)turn the monopolist into a government-run enterprise

Recognize the phases of the consumer buying process.

Evaluate personal opportunity costs in consumer purchases.

Know the legal resources available to consumers including small claims court and class-action suits.

Differentiate between mediation, arbitration, and other conflict resolution methods.

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Definitions:

Variable Costing

A method of accounting that encompasses just the variable costs associated with manufacturing—such as direct materials, direct labor, and variable manufacturing overhead—as part of the product costs.

Unit Product Cost

An assessment of the total expense incurred to produce a single unit, incorporating direct costs like labor and materials, as well as indirect costs.

Year 1

A term typically used to refer to the first year of operation or the initial year in a specific timeframe.

Variable Costing

An accounting method that only considers variable costs (costs that change with production levels) when calculating the cost of goods sold.