Using the information you have learned in this course, carefully explain whether the following statements in italics are true, false or uncertain. Using Graph

Using the information you have learned in this course, carefully explain whether the following statements in italics are true, false or uncertain. Using Graph

  1. Currently Zloobs are provided by a monopoly firm due to a patent. When the patent expires all barriers to entry are removed and producers selling similar products will enter. Removal of barrier to entry means that all deadweight losses to the economy are removed.
  2. Consider a representative firm in a perfectly competitive market selling apples. If the government were to introduce a per unit subsidy on apples then the quantity of apples produced by each firm would increase in the short run but not in the long run.

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