A. marginal costs, marginal benefits
B. demand, supply
C. marginal cost, marginal revenue
D. marginal cost, average cost
Economics Mcqs
The effect of a tax to offset a negative externality will be to …. price and …… quantity?
A. reduce , reduce
B. increase, increase
C. increase, reduce
D. reduce, increase
The social costs of monopoly power arises because ?
A. marginal cost is set equal to marginal revenue
B. price is less than marginal cost
C. marginal consumer benefit is less than marginal revenue
D. there is too little output at too high a cost
If two firms doing the same thing in the same industry join together, this is known as a ?
A. vertical merger
B. horizontal merger
C. conglomerate merger
D. hostile takeover
The problem posed by a natural monopoly is that it faces a ….. This means that …….?
A. increasing average cost curve, marginal cost lies above average cost
B. increasing average cost curve, marginal cost lies below average cost
C. decreasing average cost curve marginal cost lies above average cost
D. decreasing average cost curve, marginal cost lies below average cost
If an increase in the price of blue jeans leads to an increase in the demand for tennis shoes, then blue jeans and tennis shoes are ?
A. Complements
B. inferior goods
C. normal goods
D. none of these answers
E. Substitutes
The law of supply states that an increase in the price of a good ?
A. none of these answers
B. increases the quantity supplied of that good
C. increase the supply of that good
D. decrease the demand for the good
E. decrease the quantity demanded for that good
A monopolistic market has ?
A. many buyers and sellers
B. none of these answers
C. firms that are price takers
D. only one seller
All of the following shift the supply of watches to the right except ?
A. an advance in the technology used to manufacture watches
B. an increase in the price of watches
C. All of these answers cause an increase in the supply of watches
D. a decrease in the wage of workers employed to manufacture watches
If the price of good is below the equilibrium price ?
A. there is a shortage and the price will rise
B. the quantity demanded is equal to the quantity supplied and the price remains unchanged
C. there is a shortage and the price will fall
D. there is a surplus and the price will rise