quiz 6

quiz 6 - 1 A monopolistically competitive firm that is...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
1. A monopolistically competitive firm that is earning profits will, in the long run, experience: Possible Answers A. demand for the firm's product becomes more elastic. B. demand decreases. C. new rivals entering the market. D. all of the above. 2. Both individual buyers and sellers in perfect competition: Possible Answers A. have to take the market price as a given. B. have the market price dictated to them by government. C. can influence the market price by joining with a few of their competitors. D. can influence the market price by their own individual actions. 3. The monopolistic competitor in figure 12.1 will charge: Possible Answers A. P1. B. P2. C. P3. D. P4. 4. Is a monopolistically competitive firm productively efficient? Possible Answers A. It is because price equals average total costs. B. It is NOT because price is greater than marginal product. C. It is NOT because it does not produce at minimum average
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
total cost. D. It is because it produces where marginal cost equals marginal revenue. 5. The demand for an individual seller's product in perfect competition is: Possible Answers A. horizontal. B. the same as market demand. C. downward sloping. D. vertical. 6. If in a perfectly competitive industry, market price is below average total cost but above average variable cost at the output where marginal cost equals marginal revenue: Possible Answers A. new firms are attracted to the industry. B. firms are breaking even. C. the industry supply will not change. D. some existing firms will exit the industry. 7. At price P3 in the long run, the industry including the firm in figure 11.1 would: Possible Answers A. remain the same size. B. cease to exists. C. have exit of some existing firms. D. have entry of new firms. 8.
Background image of page 2
figure 11.1 would: Possible Answers A. remain the same size. B. have exit of some existing firms. C. have entry of new firms. D. cease to exist. 9. The key characteristics of a monopolistically competitive market structure include: Possible Answers A. all sellers sell a differentiated product. B. many, small, independently acting sellers. C. no barriers to entry of new rivals. D. all of these. 10. The demand for each seller's product in perfect competition is horizontal at the market price because: Possible Answers A. the price is set by the government. B. all the sellers get together and set the price. C. all the demanders get together and set the price. D. each seller is too small to affect market price. 11. Among the characteristics of a monopoly market structure is: Possible Answers A. the product is unique. B. entry of new sellers is completely blocked. C.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/15/2008 for the course ECO 2023 taught by Professor Sabet during the Spring '08 term at FIU.

Page1 / 14

quiz 6 - 1 A monopolistically competitive firm that is...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online