A. immediate run
B. intermediate run
C. long run
D. short run
Profit Maximizing Under Perfect Competition And Monopoly
A normal rate of profit ?
A. Is the rate of return on investments over the interest rate on risk-free government bonds.
B. is the rate that is just sufficient to keep owners or investors satisfied.
C. is the difference between total revenue and total costs
D. is zero in a perfectly competitive industry.
Economic profits are ?
A. the difference between total revenue and total costs.
B. anything greater than the normal opportunity cost of investing
C. the opportunity costs of all inputs
D. a rate of profit that is just sufficient to keep owners and investors satisfied
The slope of marginal revenue curve is ?
A. always equal to one.
B. half as steep as the demand curve
C. the same as the slope of the demand curve
D. twice as steep as the demand curve
Suppose we know that a monopolist is maximizing its profits. Which of the following is a correct inference? the monopolist has?
A. maximized its total revenue
B. set price equal to its average cost
C. equated marginal revenue and marginal cost
D. maximized the difference between marginal revenue and marginal cost.
Form society’s point of view, society would be better off if a monopolist ?
A. produced less and charged a higher price
B. produced more and charged a higher price
C. produced more and charged a lower price
D. produced less and charged a lower price.
In contestable markets, large oligopolistic firms, end up behaving like ?
A. perfectly competitive firms
B. a cartel
C. a monopoly
D. monopolistically competitive firms.
In monopolistic competition firms achieve some degree of market power ?
A. by producing differentiated products
B. because of barriers to exit from the industry
C. by virtue of size alone
D. because of barriers to entry into the industry
A firm in a monopolistically competitive industry ?
A. sells a fixed amount of output regardless of price.
B. must raise price to sell more output
C. can sell an infinite amount of output at the market-determined price
D. must lower price to sell more output.
Which of the following statements best describes the outcome under monopolistic competition ?
A. It is efficient because the right amount of output is produced, but not efficient in that the output produced is produced at a cost above minimum average total cost
B. It is efficient because entry is free and economic profits are eliminated in the long run.
C. It is not efficient because too little output is produced and the output that is produced is produced at a cost above minimum average total cost
D. It is not efficient because too little output is produced but is efficient in that the output produced is produced at minimum average total cost.