ECON-110 Week 6
Obstacles that make it difficult or impossible for would-be producers to enter a market are known as:
barriers to entry.
Assume a university pays the football coach significantly more than the university president. This makes good economic sense if the coach:
brings more revenue to the university than the president.
A minimum wage:
creates a surplus of workers.
Other things being equal, higher wage rates will:
decrease the quantity demanded of labor.
As noted in the text, which of the following protects the U.S. Postal Service as the provider of first-class mail?
A government franchise.
Which of the following statements is true, assuming the same cost and demand conditions?
A monopoly produces less output than a competitive firm.
Which of the following does not have the power to set prices?
A perfect competitor.
Which of the following would cause the equilibrium price of labor to increase?
An increase in the desire for leisure.
If the demand for labor is a derived demand, then the demand for airplane pilots depends on the:
desire for airline travel.
If the entire output of a market is produced by a single seller, the firm:
Is a monopoly
which of the following is likely to be a monopolist?
a small firm with a patent granting it the exclusive right to produce a drug.
Which of the following will increase the market demand for labor, ceteris paribus?
an increase in the productivity of labor.
The market structure of the U.S. soft drink industry is most likely:
an oligopoly.
For a monopoly in long-run equilibrium, economic profits are likely to be:
greater than zero.
The change in total revenue that results from a one-unit increase in quantity sold is:
marginal revenue.
The total quantities of a good that people are willing and able to buy at alternative prices defines:
market demand.
Suppose a market has many firms and each firm has some brand image. This type of market is called:
monopolistic competition.
the market supply of labor depends on the:
number of avaibable workers.
Temporary price reductions designed to drive out competition are called:
predatory pricing.
Which of the following do a monopolist and a competitive firm have in common?
profit-maximization rule.
An individual's labor-supply curve reveals how he or she cosses to allocate:
scarce time between labor and leisure.
Which of the following is a reason why workers typically require higher wages in order to work additional hours.
the diminishing marginal utility of extra income.
Market power exists if a firm can alter:
the market price.
When the minimum wage is raised, ceteris paribus:
there are fewer jobs available.
Which of the following is true about the equilibrium market wage for a particular industry.
there is no unemployment in this industry at this wage.
The opportunity cost of working is the:
value of leisure time that must be given up.
The quantity demanded of labor depends on the:
wage rate.
If the government eliminates a minimum wage, ceteris paribus, then:
wages will fall, but employment will rise.
Which of the following is true for a monopolist?
Profit is maximized where marginal cost equals marginal revenue.
In some situations a monopoly might be considered more desirable than a perfectly competitive firm.
if economies of scale exist and can only be realized by a single firm.
The quantity of labor supplied:
increases as the wage rate increases.
The demand curve for an individual monopolist:
is the same as the market demand curve.
Which of the following is not true of a monopoly?
it is a price taker.
The labor supply curve depicts the quantity of ___ at alternative ___.
labor supplied; wage rates
Ceteris paribus, the willingness and ability to work specific amounts of time at alternative wage rates in a given period of time is:
labor supply.
The market supply of labor:
shifts to the right when more workers enter the labor market.
When people are standing in line for jobs and there are more applicants than jobs, then the job market is characterized by a:
surplus of labor.
