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| Which of the following is a characteristic of perfect competition: |
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Definition
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| A perfectly competitive firm's marginal cost curve above the minimum point of average variable cost (AVC) is the same as: |
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Definition
| The firm's short-run supply curve |
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Term
| Suppose a firm in a perfectly competitive market discovers that the price of its product is equal to marginal cost (MC) where MC is less than AVC. Given this, the firm: |
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Definition
| Should shutdown immediately |
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Term
| In the short run, a perfectly competitive firm will incur economic loss when marginal revenue (MR) is: |
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Definition
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Term
In the short run, a firm under conditions of perfect competition can:
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Which of the following is LEAST likely to represent a perfectly competitive market:
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Definition
| The market for satellite radio reception |
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| Under perfect competition if some firms are receiving economic profits then: |
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Definition
| all of the above are correct |
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| A profit-maximizing firm would produce ______ of output and charge a price of ______: |
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Definition
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| The firm's supply curve is given by: |
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Definition
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| New firms would enter this market until price equaled: |
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Definition
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Term
| The situation above depicts the firm under perfect competition in a long-run equilibrium. |
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Definition
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Term
| At which level of output is productive efficiency achieved for the firm: |
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Definition
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Term
| Under perfect competition in the long run market price is determined by: |
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Definition
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Term
| The demand curve confronting a monopolist is: |
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Definition
| the same as the market demand curve |
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Term
| The marginal revenue curve for a momopolist: |
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Definition
| Is positive at low levels of output, then becomes negative at higher output levels |
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Term
| Which quantity of output would the profit-maximizing monopolist produce: |
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Definition
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| Which price would the profit-maximizing monopolist charge: |
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Definition
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Term
| Which of the following would represent the economic profits of the monopolist: |
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Definition
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Term
| Which quantity of output would be the allocatively efficient level of output: |
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Definition
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Term
| A profit maximizing monopolist will usually set a price: |
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Definition
| Within the elastic portion of its demand curve |
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Term
| Under which of the following situations would a monopolist increase profits by decreasing price and increasing output: |
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Definition
| If it were producing where MC < MR |
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Term
| A monopolist's demand curve is more inelastic than the market demand curve for that good. |
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Definition
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Term
| For a monopolists straight line, downward sloping demand curve, MR: |
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Definition
| Lies midway horizontally between the demand curve and the vertical axis |
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Term
| Which of the following is an example of a "natural" monopoly: |
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Definition
| railroading in the 19th century |
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Term
| "Natural monopoly" occurs primarily because of: |
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Definition
| large minimum efficient scale of plant combined with limited markets |
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Term
| A monopolist may earn economic profits in both the short run and the long run. |
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Definition
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| As compared with perfectly competitive markets, monopolies tend to over allocate resources toward the production of their product. |
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Definition
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Term
| Under pure monopoly, selling price is determined primarily by: |
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Definition
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Term
| The primary economic criticism of monopoly is that: |
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Definition
| they restrict output to inefficiently low levels compared to competitive markets |
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Term
| Which of the following is a barrier to entry: |
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Definition
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Term
| Which of the following is characteristic of monopolistic competition: |
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Definition
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Term
| In monopolistic competition, firms usually earn economic profits in the long run because of differentiated products: |
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Definition
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Term
| Monopolistically competitive firms face a demand curve that is usually: |
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Definition
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Term
| Given the information above, the profit-maximizing firm is: |
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Definition
| in short-run equilibrium earning economic profits |
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Term
| A profit-maximizing firm would produce _____ of output and charge a price of _____: |
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Definition
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Term
| In the graph above the individual firm is receiving economic profits. |
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Definition
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Term
| The demand curve for a monopolistically competitive firm is downward sloping because of: |
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Definition
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Term
| Which of the following is a source of product differentiation: |
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Definition
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Term
| Which of the following is most likely an example of monopolistic competition: |
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Definition
| the market for restaurants |
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Term
| Because of a large number of close substitutes, the demand for a monopolistically competitive firm is: |
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Definition
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Term
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Definition
| a firm in perfect competition earning a normal profit |
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Term
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Definition
| a firm in monopolistic competition receiving economic profits in the short run |
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Term
| Which graph depicts a firm incurring economic losses: |
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Definition
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Term
| In therms of allocative efficiency, a pure market economy tends to produce too few goods that involve spillover benefits (positive externatlities). |
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Definition
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Term
| which of the following is an example of a public good in the economic sense: |
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Definition
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