Assignment Instructions/ Description
ECO 561 week 3 discussion
Discussion questions and answers. Please make sure it is a paragraph format. Please include a citation/reference for each one.
- What is the difference between accounting costs and economic costs?
- Why do economic costs include both explicit (revealed and expressed) costs and implicit (present but not obvious) costs?
- What are the differences between fixed and variable costs and among total, average, and marginal costs?
- What is the difference between a market structure and a characteristic of market structure?
- What are the main characteristics of the four basic market models?
- How can purely competitive firms use the total-revenue-total-cost approach to maximize profits or minimize losses in the short run?
- How does the long run differ from the short run in pure competition?
- How do profits and losses drive the long-run adjustment process of pure competition?
- What are the barriers to entry that shield pure monopolies from competition?
- What are the economic effects of monopoly?
- Why are monopolistic competitors only earning a normal profit in the long run?
- Why does monopolistic competition deliver neither productive nor allocative efficiency?
13. Natural Monopoly
Watch the "Natural Monopoly" video.
Consider the following as you watch:
- When Alexander Graham Bell's patents expired, smaller phone companies sprang-up offering lower prices. Bell would not allow independents to use his long distance network. What was the government action?
14. Recall the readings and activities you have completed this week and describe the one or two points that were least clear to you. What questions do you have that would help you understand these points better?
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