Micro 14-16

mary is the only vetinarian in a small town. to maximize her profit, mary will choose to treat--animals per hour and charge --per customer in order to

4; $50; maximize profit

Diseconomics of scale is a result of

Difficulties of coordinating and controlling a large enterprise.

Which of the following statements is​ true?

In the long​ run, all costs are variable costs.

The change in cost that results from a one-unit increase in output is called the

Marginal cost

the return to entrepreneuership is known as

Normal profit

if a firm is able to convert every dollar of cunsumer surplus to economic profit, the firm has achieved

Perfect Price Discrimination

Because the amount of labor a firm employs can be changed, the cost of labor is known as

Variable

total cost is equal to the sum of

Variable and fixed

a natural monopoly exists when

When a single firm can supply a product to an entire market at a smaller cost than could two or more firms

a major characteristic of monopoly is

a single seller of a product

if we compare a perfectly competitive market to a single price monopoloy with the same costs, the monopoly sells

a smaller quantity at a higher price

The long run is a time period in which

all firm resources are variable

Increasing marginal returns to labor

are the result of specialization and division of labor in the production process.

The​ long-run average cost curve traces out the lowest possible​ _______ of producing each output.

average total cost

In the long​ run, perfectly competitive firms produce at the output level that has the minimum

average total cost.

The output at which average product is a maximum is the same output at which​ ______ is a minimum.

average variable cost

the theory that regulation helps producers to maximize profit is the

capture theory

When firms in a perfectly competitive market incur economic​ losses, exit by some firms means the market supply will

decrease.

For the perfectly competitive broccoli producers in​ California, the market demand curve for broccoli is

downward sloping.

when a firm is regulated so it uses an average cost pricing rule, the price

equals average total cost

The cost that a firm pays in money to hire a resource is referred to as a

explicit

If a firm shuts​ down, it

incurs an economic loss equal to its total fixed cost.

with perfect price discrimination, the level of output

is the same as the amount produced in a perfectly competitive market

A monopoly can price discriminate only if​

it sells goods and services that cannot be resold

A perfectly competitive​ firm's short-run supply curve is

its marginal cost curve above the AVC curve.

Constant returns to scale are features of a​ firm's technology that​ _______.

keep average total cost constant as output increases

If a perfectly competitive​ firm's average total cost is less than the​ price, then the firm

makes an economic profit.

A firm maximizes its profit by producing the amount of output such that

marginal revenue equals marginal cost.

The​ firm's over-riding objective is to

maximize economic profit.

the primary goal of a business firm is to

maximize profit

What is the difference between perfect competition and monopolistic​ competition?

n perfect​ competition, firms produce identical​ goods, while in monopolistic​ competition, firms produce slightly different goods.

When firms in a perfectly competitive market are earning an economic​ profit, in the long run

new firms will enter the market.

If the wheat industry is perfectly competitive with a market price of​ $4 per bushel and Farmer Brown charged​ $5 per​ bushel, how many bushels would Farmer Brown​ sell?

none

a marginal cost pricing rule sets marginal cost equal to

price

a buy one get one for half price promotion is an example of

price discriminating among units of a good.

why do publishers print the first edition of a book by a popular author in hard cover and not in paperback

readers who want to read the book are willing to pay higher price

if a monopoly wants to sell a larger quantity, it must

set a lower price

a single price monopoly

sets a single price for all consumers

If Judy experiences diseconomies of scale​, her ​long-run average cost curve​ ______.

slopes upward

In​ economics, the short run is the time frame in which the quantities of​ ______ and the long run is the period of time in which​ ______.

some resources are​ fixed; the quantities of all resources can be varied

which of the following is a fixed cost for ACME manufaturing

the annual fire and theft insurance premiums

which of the following is a list of fixed inputs for a hospital

the emergency room, intensive care unit, and other facilities

Normal profit is

the return to entrepreneurship.

if a single price monopoly is earning a large economic profit, what keeps otherfirms from competing away the price

there are barriers to entry

Average product is equal to

total product divided by quantity of labor

patents

what increases the incentive to innovate

To maximize its​ profit, in the short run a perfectly competitive firm decides

what quantity of output to produce.

In the long​ run, a perfectly competitive firm earns

zero economic profit.

Perfect competition​ ________ an efficient outcome because​ ________.

​achieves; total surplus is maximized, ​achieves; marginal benefit equals marginal cost