38 terms


average revenue, marginal revenue, and total revenue divided by output
For a purely competitive seller, price equals:
down sloping, perfectly elastic
The demand curve in a purely competitive industry is ______, while the demand curve to a single firm in that industry is _______.
can sell as much output as it chooses at the existing price
a perfectly elastic demand curve implies that the firm
change in total revenue associated with the sale of one more unit of output
marginal revenue is the
is equal to price
marginal revenue for a purely competitive firm:
to firms in all types of industries
the MR = MC rule applies:
in both the short run and the long run
the MR = MC rule applies (which run):
producing less output than allocative efficiency requires
a firm is producing an output such that the benefit from one more unit is more than the cost of producing that additional unit. This means the firm is
there is no tendency for the firm's industry to expand or contract
assume a purely competitive firm is maximizing profit at some output at which long-run average total cost is at a minimum then:
higher resource prices which occur as the industry expands
an increasing-cost industry is the result of:
of unimpeded entry to the industry
a purely competitive firm is precluded from making economic profit in the long run because:
those markets which are not purely competitive
economists uses the term imperfect competition to describe
pure monopoly
in which of the following industry structures is the entry of new firms the most difficult
pure competition
an industry comprised of a very large number of sellers producing a standardized product is known as
perfectly elastic
the demand schedule or curve confronted by the individual purely competitive firm is
each seller supplies a negligible fraction of total supply
price is constant or given to the individual firm selling in a purely competitive market because
is equal to price
marginal revenue for a purely competitive firm
economies of scale are large relative to market demand
a monopoly is most likely to emerge and be sustained when
they are all barriers to entry
what do economies of scale, the ownership of essential raw materials, and patents have in common?
marginal revenue is less than price
which is true with respect to the demand data confronting a monopolist
barriers to entry are either weak or nonexistant
monopolistic competition resembles pure competition because
advertising, product promotion, and changes in the real or perceived characteristics of a product
nonprice competition refers to
MR = MC and P > minimum ATC
when a monopolistically competitive firm is in long-run equilibrium
an underallocation of resources
in long-run equilibrium monopolistic competition entails
consumers have a number of variations of the product from which to choose
the economic inefficiencies of monopolistic competition may be offset by the fact that
products may be standardized or differentiated
in an oligopolistic market
a small number of firms produce a large proportiotn of industry output
the mutual interdependence that characterizes oligopoly arises because
pure monopoly, oligopoly, and monopolistic competition
in which of the following market models do demand and marginal revenue diverge
an abrupt change in price elasticity occurs
a kink may exist in an oligopolist's demand curve because
automobile manufacturing
which of the following is the best example of an oligopoly
the soft drink industry
which of the following is an illustration of differentiated oligopoly
may understate the degree of monopoly
if a product such as cement or bricks is costly to ship and, therefore, markets are very localized, the national concentration ratio for that indsutry
assume six firms comprising an industry have market shares of 30, 30, 10, 10, 10, and 10 percent. The Herfindahl Index for this industry is
a pure monopoly
if the firms in an oligopolistic industry can establish an effective cartel, the resulting output and price will approximate those of
neither productive efficiency nor allocative efficiency
suppose that a particular industry has a four-firm concentration ratio of 85 and a Herfindahl Index of 3,000. Most likely this industry would achieve
pure competition
under which of the following market structures will the long-run equilibrium price be equal to marginal cost?
monopolistic competition
an industry comprised of 40 firms, none of which has more than 3 percent of the total market for a differentiated product is an example of
pure monopoly, oligopoly, monopolistic competition, and pure competition
which of the following correctly arrays the various market structures in terms of their similarities to one another?