Author Question: An intersection known as Four Corners lies 300 miles from the nearest town. At this intersection are ... (Read 71 times)

Alainaaa8 · **on:** Jun 30, 2018

An intersection known as Four Corners lies 300 miles from the nearest town. At this intersection are three independently owned gas stations and one small pharmacy. Which of the following is true?
a. The firms are all perfectly competitive because of their size.
b. It would be easier for all four firms to form a cartel than for only the gas stations to do so.
c. The gas stations are monopolistically competitive because there are so few of them that they are almost monopolists.
d. The gas stations are perfectly competitive; the pharmacy is not.
e. The gas stations are oligopolists; the pharmacy is a monopolist.

Question 2

Rent-seeking behavior imposes no costs on society because it is elected officials who actually make public sector decisions.
a. True
b. False