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2030 practice test 2

2030 practice test 2 - 1 A perfectly competitive firm's...

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1 . A perfectly competitive firm's marginal revenue: A. increases as the firm's output increases. B. decreases as the firm's output increases. C. is constant. D. is below the selling price. E. is above the selling price 2. In the prisoner's dilemma, when does the prisoner have an incentive to confess? 3. Suppose government imposes a per unit tax paid by producers on a product that has a downward- sloping market demand curve and an upward-sloping market supply curve. Then, the price producers actually receive for the product (after tax price): 4. The long run market supply curve in a perfectly competitive constant-cost industry is: 5. Suppose elasticity of demand is 1, elasticity of supply is 2, and a 5% excise tax is levied on consumers. Which of the following changes will increase the burden of the tax on consumers? A. Elasticity of demand falls to 0. B. Elasticity of demand rises to 2. C. Elasticity of supply decreases to to 0.8. 6. A highly competitive market consisting of many firms selling differentiated products is: 7. A price-discriminating monopolist will charge a lower price to: A. individuals with a more inelastic demand. B. individuals with a more elastic demand. Version 1 Page 1
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