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Which of the following constitutes an implicit cost to the Johnston Manufacturing Company?
Depreciation charges on company owned equipment
Implicit and explicit costs are different in that
the former refer to non-expenditure costs and the latter to out-of-pocket costs.
The basic characteristics of the short run is that
the firm does not have sufficient time to change the size of its plant
To an economist the main difference between the short run and the long run is that
in the long run all resources are variable, while in the short run at least one resource is fixed.
If a variable input is added to some fixed input beyond some point the resulting extra output will decline. This statement describes
the law of diminishing returns
If you operated a small bakery, which of the following would be a variable cost in the short run?
Baking supplies (flour, salt, etc.)
Economists use the term imperfect competition to describe
those markets which are not purely competitive
The demand schedule or curve confronted by the individual purely competitive firmis
A perfectly elastic demand curve implies that the firm
can sell as much output as it chooses at the existing price
If a purely competitive firm shuts down in the short run
it will realize a loss equal to it total fixed costs.
A purely competitive firm's short-run supply curve
its marginal cost curve above average variable cost.
Under pure competition i the long run
both allocative efficiency and productive efficiency are achieved.
Which of the following is correct?
A purely competitive firm is a "price taker," while a monopolist is a "price maker."
In the short run, a monopolist's economic profits:
may be positive or negative depending on market demand and cost.
There is some evidence to suggest that X-inefficiency is:
more likely to occur in monopolistic firms than in competitive firms
Under monopolistic competition entry to the industry is:
more difficult than under pure competition but not nearly as difficult as under pure monopoly.
The restaurant, legal assistance, and clothing industries are each illustrations of:
In the short run a monopolistically competitive firm's economic profit:
may be positive, zero, or negative.
The term oligopoly indicates:
a few firms producing either a differentiated or a homogeneous product.
The automobile, household appliance, and automobile tire industries are all illustrations of:
The copper, aluminum, cement, and industrial alcohol industries are examples of:
Homogeneous oligopoly exists where a small number of firms are:
producing virtually identical products.
Concentration ratios measure the:
percentage of total sales accounted for by the four largest firms in the industry.
If the four-firm concentration ratio for industry X is 80:
the four largest firms account for 80 percent of total sales
The Clayton Act of 1914:
outlawed price discrimination, tying contracts, intercorporate stockholding, and interlocking directorates that lessen competition.
The function of investigating instances of fraudulent advertising has been assigned to the:
Federal Trade Commission
Which of the following gave the Federal Trade Commission responsibility to protect the public against false and misleading advertising?
Wheeler-Lea Act of 1938
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