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Econ - Economics 152 Spring 2005 Exam 2 Prof Norris...

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Economics 152 Spring 2005 Exam 2 Prof. Norris Peterson Name: __________________________ Date: _____________ 1. The short-run supply curve of a purely competitive producer is based on its: a) AVC curve. b) ATC curve. c) AFC curve. d) MC curve. Use the following to answer question 2: 2. Refer to the above diagram for a purely competitive producer. If product price is P 3 : 3. Firms seek to maximize: 4. If the price of product Y is $25 and its marginal cost is $18: 5. An unregulated pure monopolist will maximize profits by producing that output at which: a) P = MC. b) P = ATC. c) MR = MC. d) MC = AC. 6. The loss of a purely competitive firm which shuts down in the short run: Page 1
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Economics 152 Spring 2005 Exam 2 Prof. Norris Peterson Use the following to answer question 7: Use the following data to answer the next question(s). The letters A, B, and C designate three successively larger plant sizes. O u t p u t A T C - A A T C - B A T C - C 1 0 $ 6 $ 1 3 $ 4 4 2 0 5 9 3 5 3 0 4 6 2 7 4 0 5 4 2 0 5 0 7 3 1 4 6 0 1 0 4 1 1 7 0 1 4 5 8 8 0 1 9 7 6 9 0 2 5 1 0 5 1 0 0 3 2 1 6 7 7. Refer to the above data. At what level of output is minimum efficient scale realized? Use the following to answer question 8: 8. Refer to the above diagram. If price is reduced from P 1 to P 2 , total revenue will: 9. An industry comprised of a very large number of sellers producing a standardized product is known as: a) monopolistic competition b) oligopoly c) pure monopoly d) pure competition
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