Applied Microeconomics

A. p = Z
B. P = MC + Z
C. p = MC
D. P = MC – Z

A. restrict; promote
B. restrict; restrict
C. promote; promote
D. promote; restrict

A. nationalized; privatized
B. natural monopoly; potentially competitive
C. cartel; a sellers’ market
D. monopolistic competition duopoly

A. extended warranties offer value for money.
B. the cost of repair will usually exceed the cost of the warranty
C. they are paid commission on each extended warranty they sell.
D. They are concerned about customer satisfaction.

A. firms producing the same product
B. firms at various stages in production process.
C. firm producing complementary products
D. firms producing unrelated products.

A. increasing market power is the best way to achieve efficiency.
B. competition is the best way to achieve efficiency.
C. public ownership is the best way to achieve efficiency
D. regulation is the best way to achieve efficiency.

A. low; low
B. high; high
C. low; high
D. high; low

A. Spain
B. Belgium
C. USA
D. UK

A. Persuade the regulator to operate in the industry’s interests
B. Persuade the regulator to act in the firms interests.
C. Bribe the regulator.
D. Persuade the government to change the regulatory regime.

A. deregulation
B. making markets contestable
C. natural monopoly.
D. cross-subsidization.