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Question 21

At least in theory, the more competition there is in the market, the greater also is the efficiency in the economy.

True

False

Question 22

Total fixed cost curve shows that fixed costs vis-Ã -vis production levelsdon't change.

True

False

Question 23

A firm's economic profit is usually higher than its accounting profit.

True

False

Question 24

The short run is a period of time when all factor inputs are fixed.

True

False

Question 25

In general, the product price is higher in an oligopolistic market than thatof monopolistic competition.

True

False

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Nestor RutherfordLv2

15 Sep 2018

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Related questions

Question 13 (1 point)

A firm that has not shut down in the short run will not shut down in response to a decrease in the marginal costs.

Question 13 options:

	1) True
	2) False

Question 14 (1 point)

Saved

A firm earns a positive economic profit when the market price exceeds its marginal cost.

Question 14 options:

	1) True
	2) False

Question 15 (1 point)

For prices greater than the minimum value of average variable cost, the firm's short-run supply curve coincides with its short-run marginal cost curve.

Question 15 options:

	1) True
	2) False

Question 16 (1 point)

Saved

The number of firms in an industry is fixed in the short run.

Question 16 options:

	1) True
	2) False

Question 17 (1 point)

When a competitive firm earns zero profit, the market price is equal to both the firm's average and marginal costs.

Question 17 options:

	1) True
	2) False

Question 18 (1 point)

Saved

If the market price is currently above the shut-down price, the firm will be making positive profits.

Question 18 options:

	1) True
	2) False

Question 19 (1 point)

A competitive firm's supply curve is identical to its marginal cost curve.

Question 19 options:

	1) True
	2) False

Question 20 (1 point)

Saved

There is no reason for a competitive firm to stay in business if it is making zero profits.

Question 20 options:

	1) True
	2) False

tanfish913

1. In the market structure called monopolistic competition (Points : 1.25)

a) Very little advertising will occur
b) There are only a few companies in the industry
c) These industries offer only few products
d) None of the above

Question 2.2. In a purely competitive industry (Points : 1.25)

a) Products are differentiated
b) A large amount of advertising occurs
c) Price will be higher than in other market structure
d) None of the above

Question 3.3. A used lawn mower is an example of (Points : 1.25)

a) a search good
b) an experience good
c) a homogenous good
d) None of the above

Question 4.4. The problem of asymmetric can be overcome by (Points : 1.25)

a) Reputation
b) Brand name
c) Warranties
d) All of the above
e) None of the above

Question 5.5. A monopolist will always charge a higher price than a purely competitive industry (Points : 1.25)

True
False

Question 6.6. Given TC = 10 + 5Q, Ed = -2, what price will be a monopolist charge? (Points : 1.25)

a) 5
b) 12
c) 8
d) 10
e) None of the above

Question 7.7. The monopolist determines optimal output the same way as does a purely competitive industry (Points : 1.25)

True
False

Question 8.8. Given a company with some monopoly power and Ed=3, the optimal markup is (Points : 1.25)

a) 33%
b) 50%
c) 72%
d) None of the above

Question 9.9. Given the information given in 8 above and MC=6, gross margin is (Points : 1.25)

a) 50%
b) 42%
c) 33%
d) 38%
e) None of the above

Question 10.10. You would expect gross margin in a store brand to be higher than gross margin in a brand name product (Points : 1.25)

True
False

Question 11.11. You expect products that are less price elastic to have lower gross margins than products with greater price elasticity (Points : 1.25)

True
False

Question 12.12. A company with large gross margins will have large profits (Points : 1.25)

True
False

Question 13.13. If a company is incurring losses, it should stop operating (Points : 1.25)

a) Yes
b) No
c) Not enough information

Question 14.14. A monopolist may not charge the highest price they could get (at MR=MC) in the short run (Points : 1.25)

True
False

Question 15.15. All price discrimination is illegal (Points : 1.25)

True
False

Question 16.16. A company that faces different levels of demand (different price elasticities) (Points : 1.25)

a) Must charge the same price to all customers
b) is violating the law
c) Can charge different price to customers

Question 17.17. Patents allow a company the exclusive right to act as a monopolist (Points : 1.25)

a) This is not justified economically
b) It is justified economically

Question 18.18. The kinked demand curve model was developed to help explain: (Points : 1.25)

a) fluctuations of prices in pure competition
b) rigidities observed in prices in oligopolistic industries
c) fluctuations observed in prices in oligopolistic industries
d) all of the above
e) none of the above

Question 19.19. If a cartel seeks to maximize profits, the market share (or quota) for each firm should be set at a level such that the _____ of all firms is identical. (Points : 1.25)

a) average total cost
b) average profit
c) marginal profit
d) marginal cost
e)marginal revenue

Question 20.20. Factors that affect the ability of oligopolistic firms to successfully engage in cooperation include_________________. (Points : 1.25)

a) number and size distribution of sellers
b) size and frequency of orders
c) product heterogeneity
d) a and b only
e) a, b, and c

skydolphin584

I have the following questions for my Managerial Economics course.

A principal-agent problems occur when managerial decisions are not consistent with the firm's shareholders' interests.

A) True
B) False

A firm making more than a normal profit may still be experiencing an economic loss.

A) True
B) False

An inferior good is a good whose demand decreases as its prices decreases.

A) True
B) False

Assuming that crude oil is an input to automobile tires as well as to gasoline, a reduction in the tariff on imported crude oil would likely result in an increase in the number of tires sold but tire prices may increase or decrease.

A) True
B) False

Other things remaining unchanged, advertisement would likely make demand for a good more price elastic.

A) True
B) False

The cross price elasticity demand for a good with respect to the price of a complementary good is negative.

A) True
B) False

When the marginal product of labor is smaller than its average product, marginal cost will be smaller than average variable cost.

A) True
B) False

With capital measured along the vertical axis and labor along the horizontal axis the slope of an isoquant is equal to the ratio between the price of capital over the price of labor.

A) True
B) False

If the ratio between the price of labor and the price of capital (w/r) is smaller than the ration between the marginal product of labor and the marginal product of capital, the firm should hire more capital.

A) True
B) False

10.

Normally the ratio between the price of a variable input and the marginal product of that input is equal to marginal cost.

A) True
B) False

11.

When labor is a variable input the product of wage and marginal product of labor is equal to the profit-maximizing price.

A) True
B) False

12.

If the price falls below the average total cost the firm may not shut down in the short run.

A) True
B) False

13.

When a perfectly competitive firm is producing at its profit maximizing level of output, its MR is equal to price and its MC while it may or may not be making an economic profit.

A) True
B) False

14.

The price a profit maximizing monopoly charges is always greater than its marginal cost as well as it MR while it may not be greater than its ATC.

A) True
B) False

15.

As new firms enter a monopolistically competitive market, the demand faced by each competing firm becomes more inelastic.

A) True
B) False

16.

The long-run equilibrium of a monopoly is characterized by its price being equal to its MR but always greater than its ATC.

A) True
B) False

17.

A monopolistically competitive firm sets its price equal to its MR, while keeping it above MC.

A) True
B) False

18.

We say that the long-run equilibrium of a monopolistically competitive firm reflects excess capacity because its MC is not equal to its ATC.

A) True
B) False

19.

In a duopoly with a zero marginal cost, according to the Cournot model, at equilibrium the sum of the two firms' output would be more than 50 percent of the market demand at a zero price.

A) True
B) False

20.

In the kinked demand curve model it is assumed that the demand faced by an oligopoly is less elastic when it lowers the price but more elastic when it raises the price.

A) True
B) False

21.

A distinguishing characteristic of monopolistically competitive market is price discrimination.

A) True
B) False

22.

The general explanation for the relative price stability in an oligopolistic market is the existence of some degree of decision interdependency among the firms in the market.

A) True
B) False