Section 10 Econ

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20.00

According to the table above, which shows the cost of production for a firm, the average total cost of producing 3 units of output is

There are barriers to entry into and exit from the industry

All of the following are essential characteristics of a perfectly competitive industry EXEPT

Monopolistically competitive

An industry consists of 100 small firms, and the largest firm accounts for only 2 percent of sales. Brand names are considered a signal of quality. The industry described is best classified as

Downward sloping and then upward sloping

As a firm expands its output, it initially experiences economies of scale and then diseconomies of scale. The firms long-run average cost curve is

Marginal revenue equals marginal cost

The most profitable level of output for any firm operating in the short run is the level of output at which

Average fixed cost is decreasing

As output of a firm increases, the difference between the firms average total cost and its average variable cost gets smaller because the firm's

A decreasing long-run average total cost curve as a firm produces more output

Economies of scale can be illustrated by

An oligopoly

If the four largest firms in a market produce 88 percent of total industry output, the market is

16,000

If the market price is $10, how many widgets should this profit-maximizing firm produce

Marginal cost equals average total cost

In the short run, a profit maximizing firm, faced with U-shade average cost curve, is producing a level of output at which the average total cost of production is minimized. At this level of output, which of the following is true for the firm

It is equal to average fixed cost plus average variable cost

In the short run, which of the following is true of a firm's average total cost of production

Change in cost resulting from producing an additional unit of output

Marginal cost is defined as the

There are fewer firms in oligopolistic markets

One difference between oligopolies and monopolistically competitive markets is that

Accounting Profit is 50,000, and economic profit is 25,000

Raheem is currently working as a financial analyst earning $75,000 a year and is considering quitting his current job to start an art gallery. The estimated annual revenue from the art gallery is $175,000. The annual cost of labor, advertising, and acquiring the art inventory is $125,000. What are Raheems accounting and economic profits if he opens the art gallery

Diminishing marginal product

Short-run marginal cost eventually increases because of the effects of

Long-run average total cost will decrease because it becomes easier for the firm to manage its workforce

Suppose a firms production process exhibits diseconomies of scale. How and why will costs change if the firm reduces its output

$30

The average fixed cost of producing four units of output is equal to

95.00

The average total cost to the firm of producing 2 units of output it

Average Variable Cost:5 Marginal Cost:7

When output is 3 units, which of the following is correct

All factors of production are variable

Which of the following MUST be true of the long run

I and II only

Which of the following are characteristics of a perfectly competitive industry

Spreading total fixed costs over a large output, and eventually diminishing returns

Which of the following best explains why the short-run average total cost curve is U-shaped

Downward-sloping long-run average total cost curve

Which of the following is a result of increasing returns to scale

The firm is the price taker

Which of the following is true for a perfectly competitive firm


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