8. For a firm in a perfectly competitve industry a. the demand curve is unitary

Question

8. For a firm in a perfectly competitve industry

a. the demand curve is unitary elastic throughout

b. more output can be sold only if the firm unliaterally lowers its product price

c. the price elasticity of demand is zero

d. marginal revenue and product price are qual at every level of output

9. for a firm in a perfectly competitive industry, its demand curcve is

a. the same as the marginal revenue curve

b. vertical

c. downward slop

d. always above the margianl revenue curve

10. in a perfectly competive market, a firms short- run supply curve is

a. Its total cost curve between the shutdown point and the break-even point

b. its average variable cost curve below the point of intersection with its total cost curve

c. it marginal cost curve equal to or above the point of intersection iwth its average variable cost curve.

d. its total cost curve.

11. in a perfectly competitive industry, the industry demand curve

a. is downward slope

b. is upward slope

c. must be vertical

d. must be horizonal

12. Perfect compettion is characterized by

a. differentiated products of firms in the industry

b. a small number of firms

c. many buyers and sellers

d. high barriers to entry

13. for a monopolist that is maximizing profits,

a. price equal average cost

b. marginal revenue exceeds price

c. price equals marginal revenue

d. price exceeds mariginal cost

14. A firm typically achieves its postion as a monopolist as a result of

a. barriers to entry

b. a downward- sloping demand for the product

c. a small market and a constant average cost

d. the absence of long-run profits in an industry

15. a monopolist finds the price -output combination that maximizes its profits by

a. equating total revenue and total cost

b. finding the combination for which the difference between marginal revenue and marginal cost is the greatest.

c. equating price and marginal cost

d. equating marginal revenue and marginal cost

Explanation / Answer

8.a

9.c

10.a

11.b

12.c

13.b

14.b

15.c

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