A. how much to spend on advertising?
B. how much of each input to use?
C. What price to charge
D. none of these
Economics Mcqs
When …….. substitutes exist, a monopolist has …….. power to raise price?
A. more; more
B. fewer; less
C. more; less
D. no; infinite
Relative to a competitively organized industry a monopoly ?
A. Produces less output, charges higher prices and earns economic profits.
B. Produces less output, charges lower prices and earns only a normal profit
C. produces more output, charges higher prices and earns economics profits
D. produces less output, charges lower prices and earns economic profits
The short run, as economists use the phrase, is characterized by ?
A. a period where the law of diminishing returns does not hold.
B. at least one fixed factor of production and firms neither leaving nor entering the industry
C. all inputs being variable
D. no variable inputs – that is all of the factors of production are fixed
In the long run ?
A. all firms must make economic profits.
B. there are no fixed factors of production
C. a firm can vary all inputs, but it cannot change the mix of inputs it uses.
D. a firm can shut down, but it cannot exit the industry
If the ABC Typing Service is earning a rate of return greater than the return necessary for the business to continue operations, then ?
A. normal profit is zero
B. total costs exceed total revenue
C. total costs exceed normal profit
D. the firm is earning are economic profit
The normal rate of profit for relatively risk-free firms will be ……… the interest rate on risk-free government bonds?
A. approximately one-half
B. smaller than
C. larger than
D. approximately equal to
In a monopoly, marginal revenue is ?
A. lower than price for all units other than the first
B. less than price at low levels of output and greater than price at high levels of output
C. always greater than price
D. always equal to price
An industry that realizes such large economies of scale in producing its product that single-firm production of that good or service is most efficient is called ?
A. a fixed cost monopoly
B. a natural monopoly
C. a government franchise monopoly
D. a economies of scale monopoly
Members of the EU find that trade creation|| is fostered when their economies are ?
A. highly competitive
B. highly noncompetitive
C. small in economic importance
D. geographically distant