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Econ Test 2
final
29
Economics
Undergraduate 1
05/04/2009

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Cards

Term
In the short run if marginal product is at its maximum then...
Definition
Marginal cost is at its minimum
Term
If 40 units are sold at a price of $40 and 60 units are sold at a price of $20, then the elasticity of demand calculated using the midpoint formula is...
Definition
Minus 0.6
Term
When there are a few number of substitutes available for a good, demand tends to be...
Definition
Relatively inelastic
Term
If a firm doubles all its inputs in the long run and it finds its average cost of production has decreased, then it has...
Definition
Economies of scale
Term
If the cross-price elasticity of demand for goods A and B is zero, this means the two goods are...
Definition
Unrelated
Term
If a firm raised its price and found total revenue rose, then the demand for its product is...
Definition
Relatively inelastic
Term
Total revenue equals...
Definition
Price per unit times quantity sold
Term
A perfectly elastic demand curve is...
Definition
Horizontal
Term
If, as the industry expands, a competitive industry can supply larger quantities at a lower long-run equilibrium price, it is...
Definition
A decreasing-cost industry
Term
If another worker adds nine units of output to a group of workers who had an average product of seven units, then the average product of labor...
Definition
Will increase
Term
Cross-price elasticity of demand is calculated as...
Definition
Percentage change in quantity demanded of one good divided by percentage change in price of a different good
Term
If 20 units are sold at a price of $50 and 30 units are sold at a price of $40, then the elasticity of demand calculated using the midpoint formula is...
Definition
Minus 1.8
Term
Economic cost of production differ from those in accounting in that...
Definition
Economics adds the opportunity cost for a firm using its own resources
Term
When a firm changes its price, the change in total revenue...
Definition
Depends on the elasticity of demand value and the direction of the price change
Term
When a firm changes its price, the change in total revenue...
Definition
Depends on the elasticity of demand value and the direction of the price change
Term
A firm knows when a technology it has adopted has been successful...
Definition
When is can produce more output using the same inputs
Term
Price inelastic supply occurs whenever the elasticity of supply value is...
Definition
Positive and less than one
Term
Elasticity of demand...
Definition
Is more elastic in a long period of time than it is in a short period of time
Term
When the average total cost is $16, the level of total cost is $800, then the number of units the firm is producing is....
Definition
50
Term
A perfectly competitive firm breaks even at a price...
Definition
Equal to minimum average total cost
Term
A very large number of small sellers who sell identical products implies...
Definition
The inability of one seller to influence price
Term
If a firm wanted to know whether the demand for its product was elastic, unit elastic, or inelastic, then the firm could...
Definition
Change price a little bit and observe what happens to total revenue
Term
Both buyers and sellers are price takers in a perfectly competitive market because...
Definition
Each buyer and seller is too small relative to others to independently affect the market price
Term
If a firm lowered the price of the product it sells and found that total revenue did not change, then the demand for its product is...
Definition
Perfectly inelastic
Term
In the long run, a perfectly competitive market will...
Definition
Supply whatever amount consumers demand at a price determined by the minimum point on the typical firms' average total cost curve
Term
An individual seller in perfect competition will not sell at a price higher than the market price because...
Definition
Quantity demanded would be zero, the seller would not be able to sell anything, and buyers would buy from other sellers
Term
Both individual buyers and sellers in perfect competition...
Definition
Have to take the market price as given
Term
The price elasticity of demand is equal to...
Definition
The percentage change in quantity demanded divided by the percentage change in price
Term
If all we know is all workers' marginal product, then total and average product can be found by...
Definition
Summing the marginal values to find the total and dividing it by the number of workers to get the average
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