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Unformatted text preview: d. Stricter environmental regulation requiring installation of scrubbers on smokestacks. e. An increase in property taxes. f. An increase in learning on the part of labor that raises productivity. 5. Carefully explain why the Marginal Product of labor first rises and then falls as the use of labor increases. In which portion of the MP of labor curve will the firm typically produce? 6. Explain the rule for the firm to follow in the LR if its goal is to produce at the least cost. 7. Why are cartels inherently unstable? 8. How can occupational licensure be used to erect barriers to entry in an industry and generate possible monopoly profits (positive economic profits) for the industry? 9. Many natural monopolies are regulated. Explain the rationale for regulation. 10. Explain the concept of DWL (dead weight loss) as it applies to trade protection (complete ban on imports or tariffs) and monopoly....
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- Fall '10
- Perfect Competition