1. Savings accounts pay very low rates of interest. The average return on the stock market is about 10-12%, in the long run. Why would anyone put money into a savings account?
2. Explain why do cartels tend to break.
3. Explain why risk can be insured against but uncertainty cannont.
4. Why would a firm choose to remain in the industry in which it makes an economic profit of zero?
5. A function of government is to regulate "natural monopolies". Explain what is a natural monoply and why it requires government regulation.