Econ101 Midterm3 (Use graphs given by teacher)
16. (Figure: Maximum Willingness to Pay) Refer to the figure. What is the maximum price that the consumer is willing to pay for 100 units? A) $100 B) $80 C) $75 D) $90
A
The pursuit of profits in a competitive market: A) minimizes total industry costs. B) minimizes total value of production. C) leads to higher prices. D) maximizes producer surplus at the expense of consumer surplus.
A
When there are many buyers and sellers of a good and the product sold is identical across firms,: A) the demand curve for each firm's output is perfectly elastic. B) the industry demand curve is perfectly elastic. C) the demand curve for each firm's output is perfectly inelastic. D) the industry demand curve is perfectly inelastic.
A
14. (Table: Profit-Maximizing Monopolist) Refer to the table. The profit-maximizing quantity for this monopolist is ________ units A) 7 B) 8 C) 9 D) 10
B
17. (Figure: Maximum Willingness to Pay) Refer to the figure. What is the profit-maximizing quantity for this monopolist? A) 125 B) 110 C) 100 D) 75
B
19. (Figure: Monopoly Profits) Refer to the figure. The monopolist earns a profit of: A) $630. B) $420. C) $540. D) $480
B
20. (Figure: Monopoly Profits) Refer to the figure. What is the monopolist's optimal price and output level? A) P = $3.00; Q = 40 B) P = $16.50; Q = 40 C) P = $6.00; Q = 40 D) P = $6.00; Q = 80
B
8. (Table: Barrels of Oil 2) Refer to the table. What is the marginal revenue of producing the fifth barrel of oil? A) 61 B) 50 C) 200 D) 250
B
An industry is said to be perfectly competitive when: A) demand in the industry is high. B) each firm has virtually no influence over the price of its product. C) there are many buyers and sellers, and each is large relative to the total market. D) supply in the industry is highly elastic.
B
11. Refer to the figure. A monopolist who cannot price discriminate earns profit equal to area(s) ________, and a monopolist practicing perfect price discrimination earns profit equal to areas ________. A) b; ab B) ab; abc C) b; abc D) b; bc
C
13. (Table: Profit-Maximizing Monopolist) Refer to the table. When this monopolist is producing 9 units,: A) its marginal cost is below the marginal revenue level. B) its average revenue is greater than the price it receives for the product. C) it could increase its profit by raising the price and selling fewer units. D) it is producing at the socially optimal level.
C
18. Use the figure. The profit-maximizing output for this firm is: A) 40. B) 3. C) 6. D) 9.
C
2. (Figure: Perfect Price Discrimination) Refer to the figure. For a firm practicing perfect price discrimination, calculate the dollar amount of consumer surplus in this market. A) $15,000 B) $20,000 C) $0 D) $5,000
C
5. (Table: Barrels of Oil) Refer to the table. The profit-maximizing level of output is ________ barrels of oil. A) 1 B) 3 C) 5 D) 7
C
9. (Table: Barrels of Oil 2) Refer to the table. How many barrels of oil should the company produce to maximize profit? A) 6 B) 7 C) 8 D) 9
C
Competitive firms want to enter industries in which: A) P = MC. B) P < AC. C) P > AC. D) P < MC.
C
In the long run, competitive firms want to exit industries in which: A) P = MC. B) P > MC. C) P > AC. D) P < AC.
D
Price discrimination is defined as selling: A) the same products at the same prices to the same customers. B) different products at the different prices to the same customers. C) the same product at different prices to different customers. D) different products at the same prices to different customers.
C
15. (Figure: Maximum Willingness to Pay) Refer to the figure. What is the profit that the monopolist is earning? A) $10,000 B) $5,500 C) $4,500 D) There is not enough information to answer the question.
D
Firms in competitive industries: I. can only charge a price equal to the market price. II. cannot charge any more than the market price. III. will earn less profit if they charge less than the market price. A) I only B) I and III only C) II only D) I, II, and III
D