micro study guide
Marginal revenue product means the
amount by which the extra production of one more worker increases a firms total revenue
Refer to the diagram above. At the profit maximizing output, the firm will realize
an economic profit of ABGH
In what industry does the Bureau of Labor Statistics (BLS) project the highest rate of occupations is expected to be driven by
healthcare
Which of the following is correct
a purely competitive firm is a "price taker", while a monopolist is a "price maker"
refer to the data. Creamy Crisps explicits costs are
150,000
To the economist, total costs include
explicit and implicit costs
Refer to the data for a nondiscrimination monopolist. This firm will maximize its profit by producing
4 units
Answer the question on the basis of the following two scheudles, which show the amounts of additional satisfaction (marginal utility) that a consimer would get from successive quantites of products J and K
4 units of J and 5 units of K
Refer to the data. The value of Y is
45
The product price is $10 per unit and the cost per worker is $540. How many workers will the firm employ
5
Refer to the above graph showing the marginal product (MP) and the average product of labor (AP). At which quantity of labor employed does diminishing marginal returns set in
B
The price elasticity of demand coefficient measures
Buyer responsiveness to price changes
A purely competitive firm
Cannot earn economic profit in the long run
Which of the following diagrams correctly portrays a nondiscrimination pure monopolists demand (Demand) and marginal revenue (MR) curves?
D
Refer to the diagram. To maximize profits or minimize losses, this firm should produce
E units and charge price A
Refer to the diagram. To maximize profits or minimize losses, this firm will produce
E units at A price
Which of the following is most likely to be an implicit cost for Company X
Forgone rent from the building owned and used by Company X
In the figure, curves, represent the
MC, ATC, AVC, and AFC
Which of the following is a short run adjustment
a local bakery hires two additional bakers
Oligopolistic industries are characterized by
a few dominant firms substantial entry barriers
The MR=MC rule
applies both to pure monopoly and pure competition
The law of diminishing marginal utility states that
beyond some point, additional units of a product will yield less and less extra satisfaction to a consumer
Refer to the diagram. The profit maximizing level of output for this from
cannot be determined from the information given
the monopolistically competitive firm shown in the figure
cannot operate profitably in the short tun
According to the Robot Proof jobs analysis, which of these occupations is expected to be relatively robot proof
composer
Oligopolistic firms engage in collusion to
earn greater profits
The primary force encouraging the entry of new firms into a purely competitive industry is
economic profits earned by firms already in the industry
Labor unions may attempt to raise wage rates by
forcing employers, under the threat of a strike, to pay above the equilibrium wage rates
Cartels are difficult to maintain in the long run because
individual members may find it profitable to cheat on agreements
Refer to the table. Over the $6- $4 price range, supply is
inelastic
According to age earnings data
investments in education result in higher earnings
The utility of a good or service
is the satisfaction or pleasure one gets from consuming it
which of the following does not necessarily apply to a pure monopoly
its economic profits must be positive The firms will charge the highest price possible
Monopolistic competition means
many firms producing differentiated products
A consumers demand curve for a product is down sloping because
marginal utility diminishes as more of a product is consumed
Mutual interdependence means that each oligopolistic firm:
must consider the reactions of its rivals when it determines its price policy
Pure monopolists may obtain economic profits in the long run because
of barriers to entry
Concentration ratios measure the
percentage of total industry sales accounted for by the largest firms in the industry
The supply of known Monet Paintings is
perfectly inelastic
An industry comprised of a very large number of sellers producing a standardized product is known as
pure competition
In which of these continuums of degrees of competition (highest to lowest) is oligopoly properly placed?
pure competition, monopolistic, oligopoly, pure monopoly
Refer to the data. The firm is selling its output in a
purely competitive market
Refer to the diagram for a monopolistically competitive produce. The firm is
realizing a normal profit in the long run
Critics of minimum wage legislation argue that it
reduces employment
When economists say that the demand for labor is derived demand they mean that it is
related to the demand for the product or service labor is producing
Refer to the graph. other things equal, an increase in the price of a complementary resource would cause a
shift from D3 to D2
if some firms leave a monopolistically competitive industry, the demand curves of the remaining firms
shift to the right
Assume a pencil manufacturer is employing resources C and D in such quantities that the MPRs of the last unites hired are $80 and $50 respectively, the Price of resource C is $90 and the price of D is $35. The firm:
should hire less of C and more of D
which of the following defines marginal utility
the additional satisfaction from consuming one more unit of a product
Given your answer for the previous questions. The expected growth in the occupations is expected to be driven by
the aging population
Other things equal, if more firms enter a monopolistically competitive industry
the demand curves facing existing firms would shift to the left
The Illinois Railroad once asked the Illinois Commerce Commission for the permission to increase its commuter rates by 20%. The railroad argued that declining revenues made this rate increase essential. Opponents of the rate increase contended that the railroads revenues would fall because of the rate hike. It can be concluded that
the railroad felt that the demand for passenger service was inelastic and opponents of the rate increase felt it was elastic
The amount of calendar time associated with the long run
varies from industry to industry
If an exclusive union is successful in restricting the supply of labor the:
wage rate will rise
Suppose the MRP of the firms 12th worker is $22 and the workers marginal wage cost is $16. We can say with certainty that the firm
will find it profitable to hire more workers