Which of the Following Statements Is False If the Government

question 128

Multiple Choice

Which of the following statements is false if the government nationalizes an existing monopoly firm?

• A)The government usually buys out the owners of the firm and operates it as a crown corporation.
• B)A nationalized monopoly may or may not be operated to make a profit.
• C)There is no guarantee that a nationalized monopoly will be more efficient because it is owned by the government.
• D)A nationalized monopoly can be expected to always charge the socially optimum price.

---

Definitions:

Effective Annual Rate

The interest rate on an investment or loan that reflects the actual annual rate of interest, accounting for compounding over a given period.

Semi-Annual Interest Payments

Interest disbursements made twice a year on a loan or bond.

Coupon

The interest payment a bondholder receives from the bond's issuer at the coupon's interval.