ps8KeySTAR - ps 6 help

ps8KeySTAR - ps 6 help - ps8 Key Due March 31, 2010 1. You...

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1 ps8 Key Due March 31, 2010 1. You are the manager of a firm that produces output in two plants. The demand for your firm's product is P = 78 - 15Q, where Q = Q 1 + Q 2 . The marginal cost associated with producing in the two plants are MC 1 = 3Q 1 and MC 2 = 2Q 2 . What price should be charged in order to maximize revenues ? A. $39 B. $47 C. $52 D. $56 2. You are the manager of a firm that sells its product in a competitive market at a price of $50. Your firm's cost function is C = 40 + 5Q 2 . The profit-maximizing output for your firm is A. 4/5 B. 10 C. 5 D. 45 3. In a competitive industry with identical firms, long run equilibrium is characterized by A. P = AC B. P = MC C. MR = MC D. All of the statements associated with this question are correct 4. Which of the following is true? A. A monopolist produces on the inelastic portion of its demand B. A monopolist always earns an economic profit C. The more inelastic the demand, the closer marginal revenue is to price D. In the short run a monopoly will shutdown if P < AVC 5. In the long-run, monopolistically competitive firms: A. Charge prices equal to marginal cost B. Have excess capacity C. Produce at the minimum of average total cost D. Have excess capacity and produce at the minimum of average total cost 6. The primary difference between Monopolistic Competition and Perfect Competition is A. The ease of entry and exit into the industry
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ps8KeySTAR - ps 6 help - ps8 Key Due March 31, 2010 1. You...

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