Econ 105 Quiz 17
The square of the percentage market share of each firm summed over the 50 largest firms in a market is the A. Herfindahl−Hirschman Index. B. fifty−firm concentration ratio. C. elasticity of supply value. D. elasticity of demand value. E. four−firm concentration ratio.
A. Herfindahl−Hirschman Index.
Concentration ratios A. measure how concentrated a firm's sales are among certain types of goods. B. measure whether the market is dominated by a small number of firms. C. refer to the concentration of customers in a certain area. D. have high values for perfect competition. E. measure the concentration of a large number of firms in a certain area.
B. measure whether the market is dominated by a small number of firms.
A market is considered competitive if the Herfindahlminus−Hirschman Index (HHI) is ________ and its fourminus−firm concentration ratio is ________. A. high; low B. low; low C. high; high D. low; high E. between 30 percent and 70 percent; greater than 5,000
B. low; low
Which of the following is TRUE about a firm in monopolistic competition in the long run? A. MC = ATC B. ATC = MC C. P = ATC D. P = MC E. P = MR
C. P = ATC
The marginal revenue curve facing a monopolistically competitive firm A. is equal to its price curve. B. is parallel to its demand curve. C. lies below its demand curve. D. lies above its demand curve. E. lies on its demand curve.
C. lies below its demand curve.
Which of the following four−firm concentration ratios would be the best indicator of an oligopoly? A. 31 percent B. 100 percent C. 0.25 percent D. 78 percent E. 11 percent
D. 78 percent
A differentiated product has A. no close substitutes. B. no substitutes of any kind. C. many different complements. D. close but not perfect substitutes. E. many perfect substitutes.
D. close but not perfect substitutes.
The major difference between monopolistic competition and monopoly is A. only a firm in monopolistic competition can earn an economic profit in the short run. B. only firms in monopolistic competition are protected by barriers to entry. C. monopoly is a price setter and a firm in monopolistic competition is a price taker. D. only a monopoly can earn an economic profit in the long run. E. how the quantity of output is determined.
D. only a monopoly can earn an economic profit in the long run.
A firm is spending the profit−maximizing amount on product development when A. the price of the good is higher than its marginal cost. B. the firm's total revenue exceeds its total costs. C. people perceive the firm's product to be better than those of its competitors. D. the marginal cost of product development is equal to the marginal revenue from product development. E. the advertising costs are covered.
D. the marginal cost of product development is equal to the marginal revenue from product development.
What does monopolistic competition have in common with monopoly? A. barriers to entry B. a large number of firms C. the ability to collude with respect to price D. mutual interdependence E. a downward−sloping demand curve
E. a downward−sloping demand curve