ECON-102-Fall-2012-Exam-3-Version_A_and_C

B marginal cost equals marginal revenue c average

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: onal unit of Good X. b. sell the additional unit of Good X. c. realize that her production is not profitable and shut down her business. d. offer to sell 20 additional units of the good since it must be profitable. 26. Hank operates a perfectly competitive firm in the long run. For several time periods, the market price has been $20 and he knows his break- even price is $22. Hank should: a. stay in the industry. b. exit the industry. c. wait for the short- run time period. d. Shutdown 7 ECON 102 NAME: _______________________ FALL 2012 EXAM- 3 VERSION A 27. A monopolist's marginal costs increase, but the firm's demand remains the same and the firm does not shut down. Compared to before the increase in marginal costs, the monopolist will ________ its price and ________ its level of production. a. raise; decrease b. not change; decrease c. raise; increase d. lower; increase 28. Suppose that a monopolist increases production from 10 units to 11 units. If the market price declines from $20 per unit to $19 per unit, marginal revenue for the eleventh unit is: a. $1. b. $9. c. $19. d. $29. 29. A monopolist's marginal costs decrease, but the firm's demand remains the same and the firm does not shut down. Compared to before the incr...
View Full Document

This note was uploaded on 01/27/2014 for the course ECON 102 taught by Professor Kim during the Fall '08 term at University of Illinois, Urbana Champaign.

Ask a homework question - tutors are online