Microeconomic Final exam Prep

A.

land and labor.

B.

land, labor, and workers.

C.

land, workers, and firms.

D.

capital, land, and natural resources.

E.

land, labor, and capital.

A.

technical efficiency.

B.

resourcing.

C.

production.

D.

increasing returns.

E.

output.

A.

consumers who lack any preference.

B.

an indifference curve.

C.

the relationship between output and resources.

D.

the household sector.

E.

the business sector.

A.

always increasing.

B.

the maximum output that can be produced from different quantities of a variable resource.

C.

the maximum output that can be produced from different quantities of a fixed resource.

D.

the additional output produced from one more unit of a variable resource, holding other inputs constant.

E.

None of the above.

A.

The additional quantity that is produced when one additional unit of a resource is used in combination with the same quantities of all other resources

B.

The total quantity that is produced when one additional unit of a resource is used in combination with the same quantities of all other resources

C.

The total quantity that is produced when all additional units of a resource are used in combination with the same quantities of all other resources

D.

The total amount produced in a specified time period

E.

The additional quantity that is produced when all combinations of a resource are tried as an experiment

A.

it defines the relationship between costs and output in the long run.

B.

it defines the relationship between costs and output in the short run.

C.

it defines the relationship between average costs and output in the long run.

D.

it defines the relationship between marginal costs and output in the long run.

E.

it defines the relationship between total revenue and output in the long run.

A.

as output rises, average fixed costs decline because the total fixed cost is divided by a larger and larger number of units produced.

B.

as output rises, average fixed costs rise equally because of more intense resource utilization.

C.

as output rises, average fixed costs quickly drop to zero.

D.

as output rises, average fixed costs become a vertical line.

E.

as output rises, average fixed costs decline and ultimately become negative.

A.

is constant as output rises.

B.

decreases as output rises.

C.

increases with rising output and then declines.

D.

intersects with average variable cost at the lowest average variable cost.

E.

equals marginal cost at the lowest point of marginal cost.

A.

identical to fixed costs.

B.

the costs of variable inputs.

C.

those costs that are not directly attributable to the production process.

D.

the costs of labor inputs in the short run but not in the long run.

E.

the costs associated with getting in over your head.

A.

total resource schedule.

B.

total physical product schedule.

C.

average physical product schedule

D.

total cost schedule.

E.

average total cost schedule.

A.

depends on total cost only.

B.

depends on total revenue only.

C.

depends on past profit of other firms in the industry.

D.

depends on expected profit.

E.

cannot be studied with the tools of economics.

A.

total costs.

B.

normal profit.

C.

marginal costs.

D.

marginal revenue.

E.

total revenue.

A.

the marginal-revenue rule.

B.

the marginal-cost rule.

C.

the profit-maximizing rule

D.

breaking the rules.

E.

being forced out of business.

A.

total cost.

B.

marginal cost.

C.

average cost.

D.

fixed cost.

E.

variable cost.

A.

monopolistic competition and oligopoly.

B.

oligopoly and monopoly.

C.

oligopoly and perfect competition.

D.

perfect competition and monopoly.

E.

perfect monopoly and oligopolistic competition.

A.

they have a lot of market power.

B.

they are unable to set a price that differs from the market price without losing profit.

C.

they choose to set a price that differs from the market price but do not lose profit.

D.

they choose to set a price that differs from the market price in order to gain market share.

E.

in a perfectly competitive market, price is dictated through various government agencies.

A.

a monopoly market structure.

B.

perfect competition.

C.

differentiated market.

D.

monopolistic competition.

E.

an oligopoly market structure.

A.

in which there is just one firm and entry by other firms is not possible.

B.

in which consumers have many places to buy the good.

C.

in which there are a large number of close substitutes for the good.

D.

that is characterized by ease of entry.

E.

that is characterized by large expenditures on advertising.

A.

monopolistically competitive firm

B.

price taker

C.

oligopolistic firm

D.

perfectly competitive firm

E.

monopoly

A.

P=MR

B.

P=MC

C.

MR=MC

D.

MC=AC

E.

TR=TC

A.

a few firms selling identical products.

B.

a few firms selling differentiated products.

C.

many firms selling identical products.

D.

many firms selling identical products.

E.

significant barriers to entry and exit.

A.

price takers.

B.

price makers.

C.

price searchers.

D.

price maximizers.

E.

price minimizers.

A.

it will be able to gain more customers.

B.

its profit will increase because demand is elastic.

C.

it will lose all of its customers.

D.

its total revenue will decrease since it can already sell as much as it produces at a higher price.

E.

All of the above.

A.

perfectly inelastic.

B.

elastic.

C.

unit elastic.

D.

perfectly elastic.

E.

inelastic.

A.

marginal revenue equals marginal cost.

B.

price equals marginal cost.

C.

the short-run average-total-cost curve reaches a minimum.

D.

price equals marginal revenue

E.

Both a. and b.

A.

when price is less than average fixed cost.

B.

when price exceeds average total cost.

C.

by perfectly competitive firms in the long run.

D.

when marginal revenue equals marginal cost.

E.

when price equals average variable cost.

A.

at least some of its variable costs.

B.

all of its variable costs.

C.

all of its fixed costs.

D.

its total costs.

E.

the owner a reasonable profit.

A.

all firms can vary all of their resources.

B.

firms will shut down permanently if TR is less than TC.

C.

the number of firms can vary.

D.

entry and exit of firms can occur.

E.

All of the above.

A.

firms will enter the market in the short run.

B.

firms will enter the market in the long run.

C.

firms will exit the market in the short run.

D.

firms will exit the market in the long run.

E.

there will be no change in the number of firms in the market.

A.

firms spend too much on advertising expenditures.

B.

firms devote more resources to differentiating their products from rivals.

C.

the exit of firms increases.

D.

as time goes on, a firm’s product begins to have more and more substitutes and the product becomes increasingly standardized.

E.

the firm becomes a commodity.

A.

Postal services in most nations are run by the government.

B.

Cable television service in most areas is provided by a single company.

C.

In most nations, money is printed by the central bank.

D.

Electricity is delivered to your house by a single utility company.

E.

All of the above

A.

the smaller the production facility is, the lower the per-unit cost to produce is.

B.

the larger the production facility is, the higher the per-unit cost to produce is.

C.

the larger the production facility is, the lower the per-unit cost to produce is.

D.

small plants are always more efficient than large plants.

E.

the lack of exclusive ownership of essential resources.

A.

average revenue divided by quantity.

B.

total revenue divided by quantity.

C.

the change in total revenue divided by the change in quantity.

D.

the change in average revenue divided by the change in quantity.

E.

the demand curve in a monopolistic market.

A.

then the monopolist is maximizing profit.

B.

then the monopolist is earning positive economic profit.

C.

then the monopolist is charging a price equal to marginal cost.

D.

All of the above

E.

None of the above

A.

price is equal to marginal cost.

B.

the firm is producing at the minimum point of the average-total-cost curve.

C.

the firm is earning zero economic profits.

D.

the firm is earning positive economic profits.

E.

the firm is earning negative economic profits.

A.

vertical.

B.

horizontal.

C.

downward sloping.

D.

the same as the monopoly firm’s supply.

E.

None of the above

A.

have to shut down permanently.

B.

incur an economic loss.

C.

earn both a positive economic profit and a normal profit.

D.

earn only a normal profit.

E.

earn a positive economic profit.

A.

produces quality products only.

B.

does not sell products to minority groups.

C.

must have a very large operation.

D.

sells the same product in different markets at different prices.

E.

would not engage in dumping.

A.

does not yield efficiency.

B.

is efficient in the short run only.

C.

is efficient in the long run only.

D.

is efficient in both long and short runs.

E.

is inefficient because price equals marginal cost in the long run.

A.

It is a market structure.

B.

A monopolist is the sole supplier of a product.

C.

The monopolist’s product has no close substitutes.

D.

To remain a monopoly, there must be barriers to entry.

E.

Monopolists are price takers.