Microeconomics
Paper instructions:
1. Discuss the types of barriers to entry, and explain whether each type is likely to provide long-term
monopoly power. What are the allocative and distributive differences between monopoly and perfect competition? What
causes these differences?
2. Explain why product differentiation leads to differences between monopolistic competition and perfect
competition.
3. Most cases of price discrimination involve services rather than goods. Can you offer an explanation for this
observation?
A. What does it mean to say that the demand for a resource is a derived demand? Why does the supply curve of a
resource slope upward?
B.What can cause the demand for a resource to shift?
C. Distinguish between mediation and arbitration. Explain how industrial unions tend to raise wages and why
unemployed workers do not offer to work for less money.
D. Why does the division of resource earnings into economic rent and opportunity costs depend on the resource
owner’s elasticity of supply?