Microeconomics Quiz Review

2090 words 9 pages
Chapter 9
1. All firms, no matter what type of firm structure they are producing in, make their production decisions based on where:
marginal revenue equals marginal costs.
2. According to the table below, when profits are maximized, profits are equal to:

$2.
3. Many economists believe that the market for wheat in the United States is an almost perfectly competitive market. If one firm discovers a technology that makes their wheat taste better and have fewer calories than all other wheat offered in the market, the wheat market would become less competitive because:
the products would no longer be similar in the wheat market.
4. When talking about economics profits in a perfectly competitive market, the difference between the
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33. According to the figure below, a firm would be suffering a loss but still be producing if the price is:

below $5 but above $4.

34. A firm’s willingness to supply their product in the long run is represented on a graph by:
the part of the marginal cost (MC) curve above minimum average total cost (ATC).

35. It’s easy to determine if a firm is making long-run production decisions by looking at its cost structurE. This is because in the long run, a firm does not have any:
fixed costs.

36. If Nicole’s Knick-Knacks is a perfectly competitive firm and is making zero economic profits,
Nicole’s Knick-Knacks will stay in the market.

37. If Firm A is making zero economic profits,
Firm A is breaking even when opportunity cost is taken into consideration.

Chapter 10
1. One argument against patent and copyright laws is that they:
limit exposure that can benefit companies and individuals.

2. In instances when having a single firm in the market makes sense, governments ___________ to minimize negative externalities.
require licenses.

3. The following table represents the costs of production and market demand faced by a monopolist. As production increases, the price consumers are willing to pay for the good:

decreases.

4. At high price levels, demand tends to be ____________ and the price effect is ________, relative to the output effect.
elastic; small

5.

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