econ 1101 exam 2
Once I'MaPharmaCo. has received confirmation of the registration for its latest drug patent application, it will have created a monopoly for that product by restricting A. demand for the product. B. entry into the market. C. the amount of product advertising. D. the number of product compliments.
entry into the market
True or False: Perfectly Competitive Firms are easily found in the real world.
false
Which of the following is most likely to be a monopoly? A. local fast-food restaurant B. local electricity distributor C. local bathroom fixtures shop D. local television broadcaster
local electricity distributor
Shopping malls typically lease retail space to a large number of clothing stores. When this group of retailers competes to sell similar but not identical products, they engage in what economists call ________________________. A. a cartel B. collusion C. monopolistic competition D. perfect competition
monopolistic competition
There would be some control over price within rather narrow limits in which market model? A. pure competition B. monopolistic C. competition D. oligopoly
monopolistic competition
In a purely competitive industry, (a) each existing firm will engage in various forms of nonprice competition (b) new firms are free to enter and existing firms are able to leave the industry very easily (c) individual firms have a price policy (d) each firm produces a differentiated product
new firms are free to enter and existing firms are able to leave the industry very easily
If oligopolists compete hard against each other, a. they will start acting like imperfect competitors b. they will start acting like monopolistic competitors c. the costs for all will be driven up d. they will all experience zero profits
they will all experience zero profits
___________ include all spending on labor, machinery, tools, and supplies purchased from other firms. A. Total profits B. Total revenues C. Total costs D. Total profit margins
total costs
What happens in a perfectly competitive industry when economic profit is greater than zero? a. New firms may enter the industry. b. Existing firms may get larger. c. Firms may move along their LRAC curves to new outputs. d. There may be pressure on prices to fall. e. All of the above may occur.
All of the above may occur.
Saving money is a(n) ____________________, because it involves less consumption in the present, but the ability to consume more in the future. A. budget constraint B. intertemporal choice C. risk premium D. opportunity cost
intertemporal choice
A firm that holds a monopoly position in the market place is A. a price maker B. a price taker C. monopolistically competitive D. subject to infinite market forces
price maker
The marginal utility of two goods changes A. with the quantities consumed B. for the better, if taxes are imposed C. if they are inter temporal choices D. if the mother controls the household budget
with the quantities consumed
Variable costs is the:
the amount of labor, materials, and other resources required to produce your product.
Monopolistic competitors in the food industry will often include a recyclable symbol on packaging used for their product as a means to
differentiate their product
Under perfect competition, any profit-maximizing producer faces a market price equal to its A. average costs B. marginal costs C. total costs D. variable costs
marginal costs
Marginal utility can: A. be positive or negative, but not zero B. decrease, but not become negative C. be positive, negative, or zero D. increase positively, but not negatively
be positive, negative, or zero
If oligopolistic firms banded together with the intention of acting like a monopoly, it would likely result in their being able to a. divide up the monopoly level of profit amongst themselves b. hold down output in the short-run c. charge a higher price in the short-run d. both b and c are correct
divide up the monopoly level of profit amongst themselves
When Marietta chooses to only purchase a combination of goods that lie within her budget line, she: A. is decreasing utility. B. is maximizing utility. C. likely has negative savings. D. must reduce the quantity.
is maxmizing utility
A decrease in consumer preference for a product, other things being equal, will cause: A. a decrease in supply. B. market demand to shift to the left. C. market demand to shift to the right. D. quantity demanded is not a price function.
market demand to shift to the left
Economic profit can be derived from calculating total revenues minus all of the firm's costs, including its A. fixed cost B. variable C. opportunity cost
opportunity costs
Perfect competition and monopoly stand at _____________ of the spectrum of competition.
opposite ends
In which market model would there be a unique product for which there are no close substitutes? A) Pure Competition B) Oligopoly C) Monopolistic Competition D) Pure Monopoly
pure monopoly
Under which market model are the conditions of entry the most difficult? a. Oligopoly b. Pure competition c. Pure monopoly d. Monopolistic competition
pure monopoly
What role can advertising play with respect to differentiated products? A) allows a firm to sell any quantity it wishes B) shapes consumers intangible preferences C) shapes perceived demand for a price taker D) allows a firm to raise the prevailing market price
shapes consumers intangible preferences
If a mill shuts down its operations for three months, which will not be reduced to zero? a. variable cost b fixed cost c. opportunity cost d. total cost
variable costs