QUIZ 7-ECON 2302

A monopoly firm can not make any losses in the long run because such firm can always raise the price to maintain higher revenues. Question 6 options: True False

False

The competitive firm can not make profits or losses in the short-run due to the "freedom of entry and exit" that characterizes the perfect competition market. Question 9 options: True False

False

What are the four market structures that are mainly classified depending on number of sellers and the homogeneity of the product? Question 1 options: Perfect Competition, Monopolistic Competition, Mono-Competition, and Monopoly. Perfect Competition, Monopolistic Competition, Competitive Monopoly, and Monopoly. Perfect Competition, Competitive Monopoly, Oligopoly, and Monopoly. Perfect Competition, Monopolistic Competition , Oligopoly, and Monopoly.

Perfect Competition, Monopolistic Competition , Oligopoly, and Monopoly.

Referring to Figure 2 for a given competitive firm: Which of the following is true? Question 8 options: The firm always make positive profits as long as the market price is above $21. The firm always make losses as long as the market price is below $25. The firm always make zero profits (no profits or losses) as long as the market price is between $21 and $25. None of the above is true.

The firm always make positive profits as long as the market price is above $21.

Referring to Figure 1 for a given firm at a given market: Which of the following is true when the firm is at equilibrium? Question 5 options: The firm is neither making any profits nor any losses. The firm is making profits. The firm is making losses. There are not enough data to decide whether the firm is making profits, losses, or neither profits nor losses.

The firm is neither making any profits nor any losses.

Table 2 presents output, total cost, marginal cost, market price, total revenue, and marginal revenue for a given firm. Referring to Table 2: What market structure can be inferred from the table and when is the firm at equilibrium? Question 10 options: The firm is producing in the perfect competition market, and surly maximizes its long-run run profits when producing 120 units of output at a market price of $1. The firm maybe is producing in the monopolistic competition market, and surly maximizes its short-run run profits when producing 110 units of output at a market price of $1. The firm maybe is producing in the monopolistic competition market, and surly maximizes its long-run run profits when producing 90 units of output at a market price of $1. The firm is producing in the perfect competition market, and surly maximizes its short-run run profits when producing 120 units of output at a market price of $1.

The firm is producing in the perfect competition market, and surly maximizes its short-run run profits when producing 120 units of output at a market price of $1.

Table 1 presents output, total cost, marginal cost, market price, total revenue, and marginal revenue for a given firm. Referring to Table 1: What market structure can be inferred from the table and when is the firm at equilibrium? The firm is producing in the perfect competition market, and surly maximizes its long-run run profits when producing 110 units of output at a market price of $5. The firm maybe is producing in the monopolistic competition market, and surly maximizes its short-run run profits when producing 110 units of output at a market price of $5. The firm maybe is producing in the monopolistic competition market, and surly maximizes its long-run run profits when producing 90 units of output at a market price of $6. The firm is producing in the perfect competition market, and surly maximizes its short-run run profits when producing 90 units of output at a market price of $6.

The firm maybe is producing in the monopolistic competition market, and surly maximizes its short-run run profits when producing 110 units of output at a market price of $5.

The key difference between perfect competition market and monopolistic competition market is that the product in the marker is homogeneous in the earlier and differentiated in the latter. Question 2 options: True False

True

The two market structures that do not enjoy freedom of entry and exit for the sellers are oligopoly and monopoly. Question 3 options: True False

True

When joining the market as a supplier, one of the barriers to entry is the large economies of scale shared by one or more dominant firms in the market. Question 7 options: True False

True