Concept 6 Practice Quiz

1. 1The term _________________ refers to a firm operating in a perfectly competitive market that must take the prevailing market price for its product.
   
   

   1. Aprice taker
   2. Bprice setter
   3. Cbusiness entity
   4. Dtrend setter
2. 2Firms operating in a market situation that creates ___________________, sell their product in a market with other firms who produce identical or extremely similar products.
   
   

   1. Aperfect competition
   2. Ba perfect monopoly
   3. Can oligopoly
   4. Da free-market
3. 3If a firm's revenues do not cover its average variable costs, then that firm has reached its _________________.
   
   

   1. Ashutdown point
   2. Bprice taking point
   3. Cmarginal point
   4. Dopportunity margin
4. 4In economic terms, a practical approach to maximizing profits requires an examination of how changes in production affect ________________ and ________________.
   
   

   1. Amarginal revenue; marginal cost
   2. Btotal revenue; total cost
   3. Ctotal revenue; marginal cost
   4. Dmarginal revenue; total cost
5. 5A manufacturer would likely make an ___________ in a market following the long-run process of beginning and expanding production in response to ________________.
   
   

   1. Aentry; a sustained pattern of profits
   2. Baccounting profit; a strategy to grow profits
   3. Caccounting profit; an incentive for profit
   4. Dentry; an incentive to add to profits
6. 6When a business adopts a strategy of reducing and/or discontinuing production in response to a sustained pattern of losses, it is
   
   

   1. Apreparing to exit operations.
   2. Bconsidering opportunity costs.
   3. Cpreparing to reach its shutdown point.
   4. Dconsidering capital investments.
7. 7In the ________, the perfectly competitive firm will react to profits by __________________________.
   
   

   1. Along run; increasing its production
   2. Bshort run; increasing quality of products
   3. Clong run; tailoring their quality controls
   4. Dshort run; reducing its labor inputs
8. 8__________________ is attained when the maximum possible output of any one good is produced, given the output of other goods.
   
   

   1. AProductive efficiency
   2. BEconomic growth
   3. COpportunity cost
   4. DEmployment discrimination

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ECON 2203 Quiz on Concept 6 Practice Quiz, created by Adam Peterson on 18/06/2018.

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