EC 110 Lecture Notes - Marginal Revenue, Market Power, Sunk Costs
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QUESTION 17
[Table 2] This firm will maximize its profit if it produces at the point when:
a. | Profit is maximized. | |
b. | Total revenue is maximized. | |
c. | Total Cost is minimized. | |
d. | All of the above | |
e. | None of the above |
4 points
QUESTION 18
[Table 2] This firm will maximize its profit if it produces at the point when:
a. | Profit is maximized. | |
b. | Marginal cost is equal to marginal revenue | |
c. | Firm cannot be better off by producing more or less quantity | |
d. | A quantity of 13 units | |
e. | All of the above |
4 points
QUESTION 19
[Table 2] This firm will maximize its profit if it produces the following quantity:
Table 2
-1 | -2 | -3 | -4 | -5 | -6 | -7 |
Quantity Sold | Marginal Revenue | Marginal | Total | Total | Profit | |
Price | Cost | Cost | Revenue | |||
$10 | 10 | 80 | $100 | $20 | ||
$10 | 11 | (A) | 8 | 88 | $110 | $22 |
$10 | 12 | (B) | (E) | 97 | (G) | (I) |
$10 | 13 | (C) | (F) | 107 | (H) | (J) |
$10 | 14 | (D) | 11 | 118 | $140 | $22 |
a. | $9 | |
b. | $10 | |
c. | $11 | |
d. | $13 | |
e. | $14 |
4 points
QUESTION 20
[Table 2] If price increases from $10 to $11, this firm will maximize its profit if it produces the following quantity:
Table 2
-1 | -2 | -3 | -4 | -5 | -6 | -7 |
Quantity Sold | Marginal Revenue | Marginal | Total | Total | Profit | |
Price | Cost | Cost | Revenue | |||
$10 | 10 | 80 | $100 | $20 | ||
$10 | 11 | (A) | 8 | 88 | $110 | $22 |
$10 | 12 | (B) | (E) | 97 | (G) | (I) |
$10 | 13 | (C) | (F) | 107 | (H) | (J) |
$10 | 14 | (D) | 11 | 118 | $140 | $22 |
a. | $9 | |
b. | $10 | |
c. | $11 | |
d. | $12 | |
e. | $14 |
4 points
QUESTION 21
A perfectly competitive firm should increase its level of production as long as
a. | total revenue is less than total cost. | |
b. | the total revenue curve is rising. | |
c. | marginal revenue is greater than marginal cost. | |
d. | the marginal revenue curve is rising. |