Microeconomics (chapters 12, 13, and 14)

Suppose Hilda's Handbags makes large handbags and small handbags. Hilda sold 70 large bags for $450 each and 25 small bags for $150 each. Hilda's total revenue was _____ dollars.

Suppose Lester's Lassos produced 250 lassos and sold each for $100. Lester's total revenue was _____ dollars.

Suppose Hilda's Handbags makes large handbags and small handbags. Hilda sold 70 large bags for $450 each and 25 small bags for $150 each. If Hilda had total costs of $20,000, then Hilda's profit would be _____ dollars.

Fixed costs are

If a firm decreases its quantity of output, then which of the following will definitely be true?

If a firm produces no output, then its

If a firm stops production (shuts down), then its

If a firm doubles its quantity of output, then which of the following must be true?

A production function represents

The increase in output that is generated by an additional unit of input is called

The marginal product of any input into a production process is

Marginal product is represented by

The slope of the total product curve becomes

When the slope of the total product curve steepens, it means

Average fixed costs

Average variable cost

Marginal cost is

In order to take advantage of economies of scale, a firm must

A competitive market is one in which

An essential characteristic of a perfectly competitive market is that buyers and sellers have

Standardized goods and services are those that

In perfectly competitive markets, transactions costs are

Perfectly competitive markets

For firms in perfectly competitive markets, the market price is

If a firm in a perfectly competitive market faces a market price of $5 per unit and it decides to produce 400 units of output, its total revenue will be

If a firm in a perfectly competitive market is producing a level of output at which marginal costs are less than marginal revenue, it should

As long as price remains above average total cost,

In the short run, the relevant costs for a firm to consider in deciding whether to shut down production are

When a firm shuts down production, it

A firm realizes that the market price has fallen below its minimum average total cost, and hence it is now earning a loss. What is the best action for the firm to take (in the short run)?

The number of firms in a perfectly competitive market

From a long-run perspective, firms in a perfectly competitive market will

Firms will enter a perfectly-competitive market if the existing firms are making

In a perfectly competitive market, when the price is greater than the minimum average total cost of the representative firm in that market,

As the equilibrium price falls in a perfectly competitive market, so do firms'

Which of the following holds true in the long run for firms in a perfectly competitive market?

An essential characteristic of a monopolized market is

A perfect monopoly

The fundamental source of monopoly market is

Patent and copyright laws are major sources of

Encouraging firms to invest in research and development and individuals to engage in creative endeavors such as writing novels is one justification for

Which of the following would be most likely to be a natural monopoly?

When an industry is a natural monopoly,

If government officials were to break a natural monopoly up into several smaller firms, then

If a monopolist wishes to sell more output, it must

What is the shape of the monopolist's marginal revenue curve?

For an ordinary, single-price monopolist, marginal revenue (for all units greater than one) is

When a certain monopolist sets the price of its good at $8 per unit it sells 64 units. When it sets the price at $10 per unit it sells 60 units. The marginal revenue for the monopolist over this range is

A monopolist firm can sell 150 units of output for $10 per unit. Alternatively, it can sell 151 units of output for $9.95 per unit. The marginal revenue of the 151st unit of output is

As the monopolist increases output quantity, total revenue will

As the monopolist increases its output quantity, the price effect on its total revenue is

For a monopolist, the price effect

A monopolist maximizes profits by

For a monopolist it is the case at its profit-maximizing output quantity that

Positive profits can persist over time under monopoly if the monopolist

Competitive firms have

The monopolist's cost curves differ from those of a perfectly-competitive firm in that the monopolist's

The demand and marginal revenue curves faced by a monopolist are different from those faced by a perfectly-competitive firm in that the monopolist's

Many economists criticize monopolists because they

The efficient level of production in a market occurs where the marginal cost curve intersects

A monopoly is an inefficient way to produce a product because

The practice of charging customers different prices for the same good is called

Perfect price discrimination

Financial aid to college students, quantity discounts, and senior citizen discounts are all examples of

Price discrimination requires firms to

With respect to social welfare, how does given market under perfect competition compare to that same market if controlled by a monopolist engaging in perfect price discrimination?

A perfectly-price discriminating monopolist is able to

The U.S. government has used antitrust law

The Sherman Antitrust Act

In practice, setting the maximum price a natural monopoly can charge

When government owns a natural monopoly, it can

Which of the following statements is not correct?