Exam _2 Fall 2010

Exam _2 Fall 2010 - Exam #2 Fall 2010 Version #1 Student: _...

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Exam #2 Fall 2010 Version #1 Student: ___________________________________________________________________________ Figure 7.1 1. In Figure 7.1, the profit-maximizing level of output for a monopolist is: A. Between 3 and 4 units B. 2 units C. 3 units D. 4 units 2. In Figure 7.1, if this industry is competitive, the profit-maximizing level of output is: A. 3 units B. 4 units C. 2 units D. Between 3 and 4 units
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Figure 7.1 3. In Figure 7.1, if this industry is competitive, the profit-maximizing price is: A. $5.00 B. $7.00 C. $9.00 D. Between $6.00 and $7.00 4. In Figure 7.1, at the profit maximizing level of output for a monopolist, marginal cost is: A. $7.00 B. $5.00 C. Between $6.00 and $7.00 D. $9.00 5. In Figure 7.1, the price charged by a profit-maximizing monopolist is: A. $7.00 B. Between $6.00 and $7.00 C. $5.00 D. $9.00 6. The change in total revenue that results from a one-unit increase in quantity sold is: A. Marginal cost B. Marginal revenue C. Marginal profit D. Total revenue
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7. Which of the following is an example of monopolistic competition? A. Two firms supply the entire market B. One large firm supplies all of the product to the market C. Many firms supply the same product essentially, but each has significant brand loyalty D. One firm supplies 60 percent of the product to the market and there are three other rival firms 8. The demand for labor is a derived demand because it depends on the: A. Income people demand from the employer B. Demand for the goods and services workers produce C. Power that unions have to keep nonmembers out of the market D. Demand by workers for additional fringe benefits 9. Which of the following statements is true, assuming the same cost and demand conditions? A. A monopoly charges a lower price than a competitive firm B. A monopoly cannot earn an economic profit in the long run C. A monopoly maximizes profit where price equals marginal cost D. A monopoly produces less output than a competitive firm Figure 6.2 10. Refer to Figure 6.2 for a perfectly competitive firm. If the market price is $46: A. The firm should produce 19 units B. There will be economic losses C. There will be economic profits D. Economic profits equal zero 11. Refer to Figure 6.2 for a perfectly competitive firm. This firm earns zero economic profit at a price of: A. $8 B. $20 C. $30 D. $46
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12. An industry in which a few large firms supply most or all of a product is known as: A. An oligopoly B. Perfect competition C. Monopolistic competition D. A monopoly 13. Marginal _____ product sets _____ dollar limit on the wage rate an employer will pay. A. Physical; an upper B. Physical; a lower C. Revenue; an upper D. Revenue; a lower 14. In a competitive market, in the long run, economic profits will cause: A. New firms to enter the market B. Existing firms to leave the market C. Supply to decrease D. Demand to decrease 15. As more labor is hired in the short run, diminishing returns are observed because: A. The new workers are lazy B. The new workers are less skilled
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This note was uploaded on 02/13/2012 for the course ECON 224 taught by Professor Ozturk during the Spring '09 term at South Carolina.

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Exam _2 Fall 2010 - Exam #2 Fall 2010 Version #1 Student: _...

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