In the above figure, if income is 8, the initial price of a soft ...

[asd123]

In the above figure, if income is 8, the initial price of a soft drink is 1, and the initial price of a milkshake is 2, a decrease in the price of a milkshake to 1 will move the consumer from point ________ to point ________.
 
  A) a; b
  B) b; c
  C) a; d
  D) a; c

Question 2

If a natural monopoly is broken up into many smaller firms then
 
  A) the price will decrease.
  B) the average total costs of production will increase.
  C) efficiency will increase.
  D) None of the above because it is illegal to break up a natural monopoly into smaller firms.

[eliasc0401]

Answer to Question 1

D

Answer to Question 2

B