Micro- Final

Target executives believe that if they raise prices, then the customers will go across the street to shop at Walmart. However, if they lower prices, then Walmart will respond likewise, so no customer will switch from Walmart to Target. This scenario implies that:

prices charged by both retailers will be relatively stable

(Table) In the table, the marginal revenue product of the fourth worker is:

$130

(Table) In the table, the marginal physical product of the fifth worker is:

12

(Table) In the table, the total product after adding the eighth worker is:

71

(Table) In the table, the marginal physical product of the third worker is:

9

For a monopolistically competitive firm, profit is maximized when:

MC=MR

If Dixie's Dry Cleaners competes in a monopolistically competitive market, and if the firm is earning a normal profit, then:

P=ATC

For a competitive industry:

VMP=MRP

(Figure:Labor Supply Curve) In the graph, the substitution effect is shown by segment:

ab

Interdependence is the key characteristic of:

an oligopoly

An individual's supply of labor is:

backward bending with relation to the wage rate.

All of the following are characteristics of monopolistic competition, EXCEPT:

barriers to entry

(Figure:Labor Supply Curve) In the graph, the income effect is shown by segment:

bc

Collective bargaining:

consists of negations between unions and management

Which of the following characteristics do monopolistically competitive markets and perfectly competitive markets NOT share?

differentiated profits

(Figure: Monopolistic Competition) Under monopolistic competition, the price for this good or service in the graph will be:

f

(Figure: Monopolistic Competition) Under monopolistic competition, economic profit is represented in this graph by rectangle:

feab

(Figure:Labor Supply Curve) Referring to the graph, we see that this person is willing to supply ___________ hours of labor at wage rate W1 than at W2 and ____________ hours of labor at wage rate W3 than at W2.

fewer; fewer

In a cartel:

firms collude to maximize their joint profits

If Larry is given a $2-per-hour pay increase, and in response he decides to work less overtime, then:

for Larry, the income effects dominating the substitution effect.

Which of the following products would be the MOST differentiated?

garments sold to a retail customer

The kinked demand curve model assumes that if a firm raises its price, then its rivals will ___________ the price increase, and if a firm lowers its price, its rivals will _________ the price decrease.

ignore, match

Nonwork activities are known in economics as:

substitution effect

Theoretically, an increase in the minimum wage would lead to what respect labor supplied to the market, ceteris paribus?

increase the numbers of workers seeking work

Successful monopolistic competitions:

make economic profits in the short run

The amount it costs a firm to hire one more worker is known as:

marginal factor cost

A market situation in which large numbers of firms produce similar but not identical products is:

monopolistic competition

It is easy to enter and exit from which of the following industrial structures?

monopolistic competition

Large cities typically have many grocery stores, and many sell similar products of various brands and quality. The grocery store market in a big city can be BEST classified as:

monopolistic competition

In the town of Econ City, a single employer dominates the labor market. This is an example of:

monopsony

Murphy's Gas Station constantly watches the price of unleaded gas at Johnson's Gas Station. If Johnson's lowers the price of gas, so will Murphy's. This is an example of:

mutual interdependence

A craft union represents workers:

of a specific occupation

__________ markets are those where just a few firms control a large market share

oligopoly

The ____________ explains why individuals would prefer to leisure time when rages rise.

substitution effect

That market labor supply curve is:

positively sloped

Which of the following is NOT an example of product differentiation?

price discrimination

Which of the following industries is MOST likely to be an oligopoly?

steel

You are willing to work 30 hours per week at your standard wages. You would be willing to work an additional 10 hours each week if you get an additional hour. This information reflects your:

supply of labor

In oligopoly, all the firms:

take their competitors into account when they make pricing decisions

When people choose leisure over work as wages rise, they are indicating that:

the income effect is stronger than the substitution effect