16371025
Description
Quiz by Bekzhan Borbekov, updated more than 1 year ago
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Created by Bekzhan Borbekov
over 5 years ago
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Question 1
Question
Of all the costs shown below incurred by Superior Airways, which is an example of an implicit cost?
Answer
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a. The salaries paid to the pilots.
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b. The jet fuel bills.
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c. The purchases of parts needed for maintenance of the aircraft.
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d. The rent that could be earned on an aircraft that is owned and used by Superior.
Question 2
Question
Everything that needs to be given up whenever a choice is made is called:
Answer
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a. an implicit cost.
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b. an explicit cost.
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c. an opportunity cost.
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d. a sunk cost.
Question 3
Question
Accounting profit is generally ________ than economic profit, because accountants ________ implicit costs in their calculations.
Answer
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a. greater, consider
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b. greater, do not consider
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c. smaller, consider
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d. smaller, do not consider
Question 4
Question
The law of diminishing marginal product of labor occurs when:
Answer
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a. The law of diminishing marginal product of labor occurs when:
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b. every additional worker hired reduces the total costs of the firm.
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c. every additional worker hired contributes a smaller increase in production than previously hired workers.
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d. every additional worker hired contributes a smaller increase in total costs than previously hired workers.
Question 5
Question
Based on the table above, what is the marginal cost of the tenth unit?
Answer
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a. $250
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b. $200
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c. $50
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d. $300
Question 6
Question
Based on the table above, if the fixed cost is $500, what is the average total cost of the fifth unit?
Answer
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a. $250
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b. $140
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c. $240
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d. $100
Question 7
Question
Based on the table above, what is the average variable cost of the fourth unit?
Answer
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a. $250
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b. $125
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c. $240
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d. $100
Question 8
Question
Economies of scale occur when ________ as the quantity of output increases.
Answer
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a. short-run average total cost falls
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b. short-run average total cost rises
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c. long-run average total cost falls
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d. long-run average total cost rises
Question 9
Question
The cost of raw materials will fall under the category of:
Answer
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a. fixed costs.
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b. variable costs.
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c. implicit costs.
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d. average fixed costs.
Question 10
Question
The factory rent payments made by a firm fall under the category of:
Answer
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a. fixed costs.
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b. variable costs.
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c. short-run costs.
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d. average variable costs.
Question 11
Question
Which of the following is NOT a characteristic of monopolistic competition?
Answer
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a. There are many sellers.
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b. There are many buyers.
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c. Everybody is perfectly informed.
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d. The goods are identical across sellers.
Question 12
Question
The diagram depicting monopolistic competition in the short run:
Answer
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a. is very similar to the short-run monopoly diagram.
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b. is very similar to the short-run perfect competition diagram.
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c. is very similar to the short-run oligopoly diagram.
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d. is completely different from the diagrams of all the other types of markets.
Question 13
Question
If the average-total-cost curve of a firm in monopolistic competition happens to be above the demand curve, it means:
Answer
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a. the firm will have to sell a lot in order to make a profit.
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b. the firm will have to sell at a very high price in order to make a profit.
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c. other firms are performing better in the market than the firm depicted in the diagram.
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d. the firm will be incurring losses in the short run.
Question 14
Question
In the long run, firms in monopolistic competition will see their price:
Answer
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a. become equal to their average variable cost.
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b. become equal to their average total cost.
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c. remain well above their average total cost.
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d. become equal to their marginal cost.
Question 15
Question
If firms in monopolistic competition are enjoying positive economic profits, in the long run:
Answer
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a. they will continue enjoying such profits, since new firms will be unable to enter the industry.
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b. consumers will cease wanting to buy the good and will switch to cheaper alternatives.
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c. this will attract new firms into the industry, causing prices to drop and profits to disappear.
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d. the government will have to step in and regulate the price.
Question 16
Question
In long-run equilibrium, firms in monopolistic competition ________ than firms in perfect competition.
Answer
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a. produce less
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b. charge a lower price
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c. have bigger profits
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d. have lower costs
Question 17
Question
In long-run equilibrium in a monopolistically competitive market, the price will be equal to:
Answer
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a. marginal cost.
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b. marginal revenue.
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c. average variable cost.
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d. average total cost.
Question 18
Question
A major critique of advertising is that:
Answer
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a. it provides information to consumers that they would be better off without.
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b. it manipulates people's tastes and preferences.
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c. it promotes excessive competition among firms in the industry.
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d. it undermines the market price.
Question 19
Question
A major argument in favor of advertising is that:
Answer
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a. it provides information to consumers that allows them to make better choices.
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b. it helps people reaffirm their tastes and preferences.
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c. it promotes competition among firms in the industry, leading to lower prices.
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d. it will lower the market price.
Question 20
Question
According to the text, branding can be good for society because:
Answer
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a. it allows people to show off the branded goods they use or wear.
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b. it keeps generic goods from taking over the market.
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c. it provides useful information to consumers about the quality of branded goods.
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d. it helps firms enjoy higher prices and profits.
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e. Superbowl commercials are the best.
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