← Microeconomics Test
5 Written Questions
5 Matching Questions
- In a perfectly competitive mkt. if TR>TC what is happening?
- Why are pure monoplies a rarity?
- compa red to a fir m und er PC, a m onopo list produces
- WHY do costs differ between perfect competion industry and monpoly industry?
- A firm sells grapefuit at $1.50 a pound what is the firms marginal revenue?
- a economies of scale, x-inefficiency, the need for monopoly preserving expenditures, and the VERY long-run prespective
- b a smaller quantity,charges a higher price, and earns a positive economic profit
- c equals $1.50 because in a perfectly comp. industry P=AR=MR=D
- d Company is generating economic profits
- e Few goods and services rarely have only one producer
5 Multiple Choice Questions
- shut down now
- TR - TC or (P- ATC) xQ
- AR/Average Revenue
- The price will fall.
5 True/False Questions
In a Monoply short run supply curve is equivalent to what? → By subtracting total cost from total revenue or (PxQ) - (ATCxQ)
what are the characteristics of pure competition (perfect competition)? → large number of buyers and sellers, homogenous (standardized) product, no barriers to new firms entering mkt., firms are price takers and have a perfectly elastic demand.
A perfectly competitive firm should always... → Company is generating economic profits
What is another name for economies of scale? → Normal rate of return
Why is allocative efficiency not achieved in a monopoly? → P(what product is worth to consumers) > MC (what the resources used to make the product are worth)