practice questions- MicroEcon 211.pdf

practice questions- MicroEcon 211.pdf - Practice questions...

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Practice questions Section13 1. A perfectly competitive market is characterized by which of the following i. many buyers and many sellers ii. perfectly inelastic demand curves for the individual producers. iii. goods offered for sale are largely the same iv. price takers b. (i), (ii), and (iv) c. (i) only d. (i), (iii), and (iv) e. all of the above 2. A firm with market power charges a price that is than the price charged by a perfectly competitive firm. A potential advantage of this to consumers is that a. lower, it allows the firm to increase its production. b. lower, it saves the consumers money. c. higher, it allows the firm to produce more than a competitive firm. d. higher, it provides the firm with the incentive to research, develop, and improve their products. 3. When a firm with market power increases the number of units it sells, marginal revenue will be _________ when
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