question
Additional satisfaction from consuming one more unit of a good or a service is called
answer
Marginal Utility
question
Sam spends all of his income on textbooks and hot dogs. The price of a textbook is $40 and the price of a hot dog is $0.50. If Sam is maximizing his utility and the marginal utility he derives from the last textbook he purchases is 400, then the marginal utility he derives from his last hot dog purchased must be
answer
5
question
"I really enjoy watching movies. The first one is best. After that I still enjoy movies but the last one is not as much fun to watch as the one before it." This statement reflects the***
answer
Principle of diminishing marginal utility
question
A period of time in which the quantity of at least one factor of production used by a firm is fixed is called the
answer
Short run
question
An example of a variable factor of production in the short run is
answer
An employee
question
Marginal cost of production eventually increases because
answer
All Of the Above is Correct:
A) of the law of diminishing returns.
B) eventually each additional worker produces a successively smaller addition to output.
C) the marginal product of the variable input eventually falls.
A) of the law of diminishing returns.
B) eventually each additional worker produces a successively smaller addition to output.
C) the marginal product of the variable input eventually falls.
question
"Diminishing marginal returns" refer to a situation in which the
answer
Marginal product of the next worker hired is less than the marginal product of the previous worker hired.
question
If average variable cost is decreasing as output increases, then marginal cost is definitely***
answer
Less than average variable cost
question
Ma Baensch's pickled herring factory has variable costs of $500 for 500 jars and variable costs of $503 for 501 jars. The marginal cost of the 501st jar is:
answer
A) Unknown because we do not know fixed costs. B) Unknown because we do not know total costs. C) Both a) and b)
D) $503
E) $3--CORRECT
D) $503
E) $3--CORRECT
question
One of the following curves continuously falls as output increases,***
answer
A) AVC
B) ATC
C) TFC
D) MC
E) AFC--CORRECT
B) ATC
C) TFC
D) MC
E) AFC--CORRECT
question
Sam, a cost analyst for Jiffy, observes that when they are producing 800 jars of peanut butter an hour, their marginal cost is 25 cents ($0.25), their average total cost is only 55 cents ($0.55) and their average variable cost is 30 cents ($0.30). From this, Sam concludes that average total costs must be _________ and average variable costs must be ______________ as they increase production from 800 jars per hour.***
answer
A) Falling: falling.--CORRECT
B) Rising: rising.
C) Rising: becoming flat.
D) Rising: falling.
E) Falling: rising.
B) Rising: rising.
C) Rising: becoming flat.
D) Rising: falling.
E) Falling: rising.
question
Which of the following is not true about a perfect competition? ***
answer
A) All firms produce identical goods/services
B) All firms make zero economic profit in the long-run
C) All firms with short-run economic loss will leave the market in the long run.--CORRECT
D) A perfectly competitive firm faces a horizontal demand curve
E) None
B) All firms make zero economic profit in the long-run
C) All firms with short-run economic loss will leave the market in the long run.--CORRECT
D) A perfectly competitive firm faces a horizontal demand curve
E) None
question
Which of the following is not true about a perfect competition?***
answer
A) All firms produce identical goods/services
B) All firms make zero economic profit in the long-run
C) All firms with short-run economic loss will leave the market in the long run.--CORRECT
D) A perfectly competitive firm faces a horizontal demand curve
E) None
B) All firms make zero economic profit in the long-run
C) All firms with short-run economic loss will leave the market in the long run.--CORRECT
D) A perfectly competitive firm faces a horizontal demand curve
E) None
question
Consider a firm that has enough capacity to produce up to 5 balloons. Suppose it costs firm $1 to make just one balloon; $2 to make 2 balloons; $4 to make 3 balloons; $7 to make 4 balloons; and $11 to make 5 balloons. How many balloons will the firm make if the market price for balloons is $2? ***
answer
A) 0 balloons
B) 1 balloon
C) 2 balloons
D) 3 balloons--CORRECT
E) 4 balloons
B) 1 balloon
C) 2 balloons
D) 3 balloons--CORRECT
E) 4 balloons
question
The short run supply curve of a competitive firm is the same as***
answer
A) The upward sloping portion of the average cost curve.
B) The upward sloping portion of the marginal cost curve.
C) The upward sloping portion of the marginal cost curve above the average variable cost curve.--CORRECT
D) The upward sloping portion of the marginal cost curve above the average total cost curve.
B) The upward sloping portion of the marginal cost curve.
C) The upward sloping portion of the marginal cost curve above the average variable cost curve.--CORRECT
D) The upward sloping portion of the marginal cost curve above the average total cost curve.
question
A monopoly is best defined as a firm that***
answer
A) produces a good or service for which no close substitute exists and which is protected by a barrier that prevents other firms from selling that good or service.--CORRECT
B) purchases its resources from only one supplier because of a barrier preventing it from buying from other suppliers.
C) produces a good or service for which no close substitute exists and that sells all its output to one buyer because there is barrier preventing other buyers from purchasing the good or service.
D) cannot control the price it sets for its good or service because there is barrier that prevents the firm from changing the price.
B) purchases its resources from only one supplier because of a barrier preventing it from buying from other suppliers.
C) produces a good or service for which no close substitute exists and that sells all its output to one buyer because there is barrier preventing other buyers from purchasing the good or service.
D) cannot control the price it sets for its good or service because there is barrier that prevents the firm from changing the price.
question
The marginal revenue curve for a single-price monopoly***
answer
A) lies below its demand curve.--CORRECT
B) coincides with its demand curve.
C) lies above its demand curve.
D) is horizontal.
B) coincides with its demand curve.
C) lies above its demand curve.
D) is horizontal.
question
Which of the following is a true statement***
answer
A) a monopoly firm can earn positive economic profit in the long run.--CORRECT
B) monopoly market is preferred to the perfect market for consumer welfare (surplus).
C) entry of new firms is easy in monopoly market than in perfect market.
D) a monopoly firm is a price taker.
B) monopoly market is preferred to the perfect market for consumer welfare (surplus).
C) entry of new firms is easy in monopoly market than in perfect market.
D) a monopoly firm is a price taker.
question
Which of the following statements about a monopoly is FALSE?***
answer
A) Monopolies have no barriers to entry or exit.--CORRECT
B) The good produced by a monopoly has no close substitutes.
C) A monopoly is the only producer of the good.
D) None of the above; that is, all of the above answers are true statements about a monopoly.
B) The good produced by a monopoly has no close substitutes.
C) A monopoly is the only producer of the good.
D) None of the above; that is, all of the above answers are true statements about a monopoly.
question
budget line
answer
illustrates the limits of consumption possibilities
-marks the boundary between those combinations of goods and services that the consumer can afford to buy and those that it cannot afford
-marks the boundary between those combinations of goods and services that the consumer can afford to buy and those that it cannot afford
question
2 factors determine a household's consumption choices
answer
1) consumption possibilites
2) preferences
2) preferences
question
utility maximization
answer
objective of any consumer
question
total product
answer
the max output that a given quantity of labor can produce
question
average product
answer
the total product of labor divided by the quantity of labor employed with all other inputs remaining the same
question
long run
answer
a firm can increase the quantity of any or all of the factors of production it employs to increase its production
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
