Micro Unit 4 Econ Challenge

1

How do industries under monopolistic competition resemble those in pure competition?

In both market structures, barriers to entry are weak or do not exist.

Industries in both market structures consist of only a few firms.

Industries in both market structures are price searchers as opposed to price takers.

Differentiated products are produced in both market structures.

In the long run, industries in both market structures earn high economic profits.

1

In the short run, a pure monopolist will

always realize a loss.

always earn a normal profit (aka break even).

always earn economic profits.

either earn an economic profit, a loss, or break even depending on revenues and costs.

have incentives to produce the largest quantity at the lowest price given by the demand curve.

1

If one of a firm's fixed costs rises,

its profit-maximizing output level will remain the same after it adjusts its output level (either up or down)

its profit-maximizing output level will increase.

it would likely increase its prices.

its profit-maximizing output level will not change.

its profit-maximizing output level will decrease.

1

All of the following are characteristics of oligopolies EXCEPT

large expenditures on advertising and product development

extensive price competition to gain market share

the existence of significant barriers to entry

considerable concentration of the means of production

"price-setting" through informal price leadership agreements

1

Which type of merger creates the greatest threat of increased monopoly power?

1

Given the marginal revenue function MR=20-0.4Q, when Q=50 which best describes the price elasticity of demand? It is

1

When each player in a game chooses the action that maximizes his or her payoff given the actions of other players (ignoring effects on the other players' payoffs) this is known as a

1

Which occurs when average cost pricing is applied to a regulated natural monopoly?

1

Suppose this represents a monopolist with a patent. Up to how much is the monopolist willing to spend to defend its patent?

1

The profit-maximizing monopolist will choose the price and quantity represented by point

1

The Beziers Company is a profit-maximizing monopolist that exercises monopoly power in the distribution of diamonds. If the company earns positive economic profits this year, then the price of diamonds will

be unit neutral.

be equal to the average total cost of diamonds.

exceed the marginal cost of diamonds but be equal to the average total cost of diamonds.

exceed both the marginal cost and the average total cost of diamonds.

be equal to the marginal cost of diamonds.

1

The graph that shows the relationship between the size of a tax and the tax revenue collected by the government is known as a

1

When the demand curve for a firm in monopolistic competition shifts:

the marginal cost curve will increase.

the marginal cost curve will decrease.

the marginal revenue curve will not shift.

the marginal revenue curve must shift in the opposite direction.

the marginal revenue curve must shift in the same direction.

1

Which of the following prohibited any person from being a director of two or more competing corporations?

1

An established firm is facing competition from a new firm regarding the size of a toy. The potential sizes of the toy are X and Y, as shown in the table below along with the payout of certain choices.
Firm 2
X
Y
Firm 1
X
$10, $5
$5, $10
Y
$5, $10
$10, $5
Based on the table, which statement is true?

Choice X,X is a Nash equilibrium.

Firm 1 has no dominant strategy, but firm 2 does.

Choice Y,Y is a Nash equilibrium.

Neither firm has a dominant strategy.

Firm 2 has no dominant strategy, but firm 1 does.

1

The shaded triangle in the graph represents which economic term?

The effects of a positive externality

The incidence of tax

The monopoly's economic profit

The consumers burden of tax

Deadweight loss caused by a monopoly

1

An entrepreneur has earned enough total revenue to cover her accounting costs, but economic losses are being incurred. What must be true?

Her accounting profits are greater than her economic costs.

Her accounting costs are larger than her economic costs.

Her economic losses are less than her total variable costs.

Her economic losses are less than her total fixed costs.

Her accounting profits are less than her implicit costs.

1

Demand: P=21-Q
Supply: P=3+2Q
At the market equilibrium, PS and CS are (respectively)

1

Which of the following types of mergers leads directly to higher concentration ratios?

1

Perfectly competitive markets differ from monopolistically competitive markets in which way?

there are many sellers

the goods/services are identical to one another

there are many buyers

There are no to low barriers to entry.

the goods/services are imported and exported

1

A PURE market economy would be best suited to achieve which major socioeconomic goals?

1

What is the most likely effect on price, quantity exchanged, and consumer surplus of a technological advance that lowers the cost of producing laptop computers?

1

When a firm is operating at minimum efficient scale, they are producing

at a point at which profits first become positive.

at a point at which average total cost is falling.

at the smallest scale at which long run average total costs are minimized.

at the point where economies of scale first set in.

at a point at which marginal cost is greater than average total cost.

1

Mark learns that an inherited genetic disease affects people in his family. This disease will likely cause early death. Mark immediately applies for a large life-insurance policy without disclosing this genetic fact. This situation between Mark and the insurers:

is economically efficient because it overcomes a moral hazard problem.

is economically efficient because Mark gets to buy the insurance he wants.

is economically inefficient because of a fiduciary relationship.

is economically efficient because Mark's family will need the money when he dies.

is economically inefficient because of asymmetric information.

1

Which of the following statements about a firm's production function is necessarily true?
I. When total product is at its maximum, marginal product is zero.
II. When total product rises, marginal product is rising.
III. When marginal product is greater than average product, average product is falling.
IV. When marginal product is less than average product, marginal product is falling.

Micro Unit 4 Econ Challenge

How do industries under monopolistic competition resemble those in pure competition?

In the short run, a pure monopolist will

If one of a firm's fixed costs rises,

All of the following are characteristics of oligopolies EXCEPT

Which type of merger creates the greatest threat of increased monopoly power?

Given the marginal revenue function MR=20-0.4Q, when Q=50 which best describes the price elasticity of demand? It is

When each player in a game chooses the action that maximizes his or her payoff given the actions of other players (ignoring effects on the other players' payoffs) this is known as a

Which occurs when average cost pricing is applied to a regulated natural monopoly?

Suppose this represents a monopolist with a patent. Up to how much is the monopolist willing to spend to defend its patent?

The profit-maximizing monopolist will choose the price and quantity represented by point

The Beziers Company is a profit-maximizing monopolist that exercises monopoly power in the distribution of diamonds. If the company earns positive economic profits this year, then the price of diamonds will

The graph that shows the relationship between the size of a tax and the tax revenue collected by the government is known as a

When the demand curve for a firm in monopolistic competition shifts:

Which of the following prohibited any person from being a director of two or more competing corporations?

An established firm is facing competition from a new firm regarding the size of a toy. The potential sizes of the toy are X and Y, as shown in the table below along with the payout of certain choices.Firm 2XYFirm 1X$10, $5$5, $10Y$5, $10$10, $5Based on the table, which statement is true?

The shaded triangle in the graph represents which economic term?

An entrepreneur has earned enough total revenue to cover her accounting costs, but economic losses are being incurred. What must be true?

Demand: P=21-QSupply: P=3+2QAt the market equilibrium, PS and CS are (respectively)

Which of the following types of mergers leads directly to higher concentration ratios?

Perfectly competitive markets differ from monopolistically competitive markets in which way?

A PURE market economy would be best suited to achieve which major socioeconomic goals?

What is the most likely effect on price, quantity exchanged, and consumer surplus of a technological advance that lowers the cost of producing laptop computers?

When a firm is operating at minimum efficient scale, they are producing

Mark learns that an inherited genetic disease affects people in his family. This disease will likely cause early death. Mark immediately applies for a large life-insurance policy without disclosing this genetic fact. This situation between Mark and the insurers:

How do industries under monopolistic competition resemble those in pure competition?

In the short run, a pure monopolist will

If one of a firm's fixed costs rises,

All of the following are characteristics of oligopolies EXCEPT

Which type of merger creates the greatest threat of increased monopoly power?

Given the marginal revenue function MR=20-0.4Q, when Q=50 which best describes the price elasticity of demand? It is

When each player in a game chooses the action that maximizes his or her payoff given the actions of other players (ignoring effects on the other players' payoffs) this is known as a

Which occurs when average cost pricing is applied to a regulated natural monopoly?

Suppose this represents a monopolist with a patent. Up to how much is the monopolist willing to spend to defend its patent?

The profit-maximizing monopolist will choose the price and quantity represented by point

The Beziers Company is a profit-maximizing monopolist that exercises monopoly power in the distribution of diamonds. If the company earns positive economic profits this year, then the price of diamonds will

The graph that shows the relationship between the size of a tax and the tax revenue collected by the government is known as a

When the demand curve for a firm in monopolistic competition shifts:

Which of the following prohibited any person from being a director of two or more competing corporations?

An established firm is facing competition from a new firm regarding the size of a toy. The potential sizes of the toy are X and Y, as shown in the table below along with the payout of certain choices.Firm 2XYFirm 1X$10, $5$5, $10Y$5, $10$10, $5Based on the table, which statement is true?

The shaded triangle in the graph represents which economic term?

An entrepreneur has earned enough total revenue to cover her accounting costs, but economic losses are being incurred. What must be true?

Demand: P=21-QSupply: P=3+2QAt the market equilibrium, PS and CS are (respectively)

Which of the following types of mergers leads directly to higher concentration ratios?

Perfectly competitive markets differ from monopolistically competitive markets in which way?

A PURE market economy would be best suited to achieve which major socioeconomic goals?

What is the most likely effect on price, quantity exchanged, and consumer surplus of a technological advance that lowers the cost of producing laptop computers?

When a firm is operating at minimum efficient scale, they are producing

Mark learns that an inherited genetic disease affects people in his family. This disease will likely cause early death. Mark immediately applies for a large life-insurance policy without disclosing this genetic fact. This situation between Mark and the insurers:

An established firm is facing competition from a new firm regarding the size of a toy. The potential sizes of the toy are X and Y, as shown in the table below along with the payout of certain choices.
Firm 2
X
Y
Firm 1
X
$10, $5
$5, $10
Y
$5, $10
$10, $5
Based on the table, which statement is true?

Demand: P=21-Q
Supply: P=3+2Q
At the market equilibrium, PS and CS are (respectively)

An established firm is facing competition from a new firm regarding the size of a toy. The potential sizes of the toy are X and Y, as shown in the table below along with the payout of certain choices.
Firm 2
X
Y
Firm 1
X
$10, $5
$5, $10
Y
$5, $10
$10, $5
Based on the table, which statement is true?

Demand: P=21-Q
Supply: P=3+2Q
At the market equilibrium, PS and CS are (respectively)