Crowdly

Add to Chrome

Questions Bank (1496179 total)

If a perfectly competitive firm is producing in the short run at an output where price is less than average total cost, the firm

is incurring an economic loss but will continue to operate as long as price is above minimum average variable cost.

is incurring an economic loss but will continue to operate as long as price is above minimum average fixed cost.

is breaking even.

is still making a positive economic profit.

will shut down.

View this question

Lin's fortune cookies are identical to the fortune cookies made by dozens of other firms, and there is free entry in the fortune cookie market. Buyers and sellers are well informed about prices. The price of a fortune cookie is determined by ________. The marginal revenue of a fortune cookie equals ________.

the ingredients that Lin's uses to produce his fortune cookies; average total cost

market demand and market supply; price

the number of cookies that Lin's produces; average variable cost

the freshness of the fortune cookies; average fixed cost

market demand and market supply; the price elasticity of demand

View this question

Use the figure below to answer the following questions.

Figure 12.5.2

Consider the natural monopoly depicted in Figure 12.5.2. If a regulatory agency sets a price just sufficient for the firm to make zero economic profit, and if the firm inflates its costs as much as possible, the regulated price will be

either P₀ or P₃.

View this question

Joe’s Shiny Shoes is a firm that operates in a competitive market. The graph shows Joe’s marginal cost and average variable cost curve. Joe’s Supply curve is described by the curve segment ________

None of the above.

CD

CE

ABCD

BCD

View this question

Why is a competitive firm’s marginal-cost curve regarded as its supply curve?

The firm is aware that marginal revenue must exceed marginal cost in order for profit to be maximized.

none of the above

The marginal cost curve determines the quantity of output the firm is willing to supply at any price.

Among the various cost curves, the marginal-cost curve is the only one that slopes upward.

The position of the marginal-cost curve determines the price for which the firm should sell its product.

View this question

One potential advantage that a monopoly might have over perfect competition is

almost always a lower price.

none of the above.

almost always a higher output.

diseconomies of scale.

possibly an increased incentive to innovate.

View this question

Which of the following is LEAST likely to be a natural monopoly?

cable television services

taxicab service

water and sewer services

electric utilities

subway services

View this question

What is the amount that producers receive for a good minus their costs of producing it?

producer surplus

None of the above.

quantity supplied

View this question

Which of the following statements is not always true for a monopolist in short-run equilibrium?

None of the above.

View this question

A monopolist under rate of return regulation has an incentive to

maximize consumer surplus.

maximize shareholder profits

produce more than the efficient quantity of output.

charge a price equal to marginal cost.

View this question

Previous
1
140002
140003
140004
140005
140006
149618
Next

Telegram Instagram TikTok Question Bank

Terms of Use Contact Us

Add to Chrome