Principles of Microeconomics Exam 3

question

U.S. Automobile Type Industry

answer

Oligopoly

question

Agriculture type industry

answer

Most close pure competition

question

Oligopoly

answer

Clear-cut mutual interdependence with respect to price-output policies

question

Pure monopoly

answer

Entry of new firms the most difficult; one firm industry; downward sloping demand curve

question

Monopolistic competition

answer

Little percentage of total market for a differentiates product

question

Pure competition industry

answer

Very large number of sellers producing a standardized product; marginal revenue is a straight line, parallel to the horizontal axis (equal price); price x quantity sold

question

A competitive firm in the short run can determine the profit-maximizing (or loss-minimizing) output by equating:

answer

Marginal revenue and marginal cost

question

Purely competitive seller is:

answer

a "price taker"

question

The demand schedule or curve confronted by the individual purely competitive firm is:

answer

Perfectly elastic (horizontal)

question

Economic profit occurs when:

answer

Total revenue exceeds total cost

question

Break-even point

answer

Total revenue and total cost are equal;

question

With respect to the pure monopolist's demand curve it can be said that:

answer

Price exceeds marginal revenue at all outputs greater than 1; downsloping

question

The marginal revenue curve for a monopolist:

answer

Becomes negative when output increases beyond some particular level

question

MR = MC rule applies

answer

To firms in all types of industries; to both pure monopoly and pure competition

question

If a purely competitive firm shuts down in the short run:

answer

It will realize a loss equal to its total fixed costs

question

A purely competitive firm should produce in the short run if its total revenue is sufficient to cover its:

answer

Total variable costs

question

The practice of price discrimination is associated with pure monopoly because:

answer

Monopolists have considerable ability to control output and price

question

The price is committing pure monopolist will attempt to charge each buyer:

answer

The maximum price each would be willing to pay

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Price discrimination is:

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Only illegal if used to lesson or eliminate competition

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ATC = MC

answer

Economic profits will be zero

question

Pure monopoly

answer

A single firm producing a product for which there are no close substitutes; "price makers"

1 of 21

question

U.S. Automobile Type Industry

answer

Oligopoly

question

Agriculture type industry

answer

Most close pure competition

question

Oligopoly

answer

Clear-cut mutual interdependence with respect to price-output policies

question

Pure monopoly

answer

Entry of new firms the most difficult; one firm industry; downward sloping demand curve

question

Monopolistic competition

answer

Little percentage of total market for a differentiates product

question

Pure competition industry

answer

Very large number of sellers producing a standardized product; marginal revenue is a straight line, parallel to the horizontal axis (equal price); price x quantity sold

question

A competitive firm in the short run can determine the profit-maximizing (or loss-minimizing) output by equating:

answer

Marginal revenue and marginal cost

question

Purely competitive seller is:

answer

a "price taker"

question

The demand schedule or curve confronted by the individual purely competitive firm is:

answer

Perfectly elastic (horizontal)

question

Economic profit occurs when:

answer

Total revenue exceeds total cost

question

Break-even point

answer

Total revenue and total cost are equal;

question

With respect to the pure monopolist's demand curve it can be said that:

answer

Price exceeds marginal revenue at all outputs greater than 1; downsloping

question

The marginal revenue curve for a monopolist:

answer

Becomes negative when output increases beyond some particular level

question

MR = MC rule applies

answer

To firms in all types of industries; to both pure monopoly and pure competition

question

If a purely competitive firm shuts down in the short run:

answer

It will realize a loss equal to its total fixed costs

question

A purely competitive firm should produce in the short run if its total revenue is sufficient to cover its:

answer

Total variable costs

question

The practice of price discrimination is associated with pure monopoly because:

answer

Monopolists have considerable ability to control output and price

question

The price is committing pure monopolist will attempt to charge each buyer:

answer

The maximum price each would be willing to pay

question

Price discrimination is:

answer

Only illegal if used to lesson or eliminate competition

question

ATC = MC

answer

Economic profits will be zero

question

Pure monopoly

answer

A single firm producing a product for which there are no close substitutes; "price makers"

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