Question # 1

Firms in monopolistic competition compete on

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Price

Quality

Advertising

All of the above are correct

Immediately after a through we would expect to have al

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Peak

Recession

Recovery

Another trough

In contract to perfectly competitive markets monopolists

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Do no have to worry about market demand

Sell only if demand is inelastic

Can never incur an economic loss

Can earn an economic profit indefinitely

Firm A's margin of safety is.

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0.10

0.40

0.20

0.30

A monopolist will discontinue production if

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Marginal revenue is less than marginal cost

Marginal revenue is less than average total cost

Marginal revenue is less the average fixed cost

Price is less than average variable cost

An oligopolistic industry can be characterized by all of the following except

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May sellers

mutual interdependence

Economies of scale

A homogenous product

A price cross elasticity of 0.81 between X and Y shows that.

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They are complementary goods

They are competitive substitutes

They are not substitutes

a reduction in the price of one would cause an increase in the consumption of the other.

When the quantity demanded is changed on the same price

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the demand curve shifts upward

The demand curve shifts downward

Movement on the same demand curve

None of these

The largest source of tax revenue for the federal government is

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The prerenal income tax

The social security tax

the property tax

The sales tax

the ouput where diminishing return to production begin is also the ouput where

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Marginal cost is at a minimum.

Average total cost is at a minimum

Average variable cost is at a minimum

Marginal and average

The supply curve of a monopolist is always.

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More elastic

Less elastic

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Steeper

When the price of a pizza decreased from 1200 Rupees to 1000 Rupees, it is definitely the case that the.

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Income effect means people buy less pizza

Substitution effect means people buy more pizza

Quantity demanded of pizza will not change

None of the above

If the government lower taxes by $10 billion, the Real GDP will rise by

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More than $10 billion

Less than $10 billion

Exactly $10 billion

None of these

In monopolistic competition, firms desire to sell more output at equilibrium because.

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Price is greater than average cost

Price is greater than average variable cost

Price is greater than marginal cost

Price is equal to marginal revenue

Price discrimination occurs when

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A commodity has different elasticity in different markets

Same elasticity in different markets

Unitary elasticity different markets

Noe of these

The Marginal cost of product W exhibiting positive externalities is McW = 25 + 5 Qs, the competitive price for each unit of W (Pw) is Rs. 175 and the positive externality is worth Rs. 100 to society for each unit produced. Society considers product W under produced by how many units.

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10 Units

15 Units

20 Units

5 units

In monopolistic competition firm sell

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Same goods

Differential goods

Inferior goods

Superior goods

When oligopolistic firms interacting with one another each choose their best strategy given the strategies chosen by other firms in the market we have.

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A cartel

The perfect competitive outcome

The Nash equilibrium

Monopolistic competition

Oligopoly is a market structure in which

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Many firms each produce a slightly differentiated product

One firm produces as unique product

A small number of firms compete

Many firms produce an identical product

If the price of factor A is Rs.8.00 per hour, and its marginal product is 10 units, and the price of factor B is Rs. 5.00 and its marginal product is 9, is the producer is likely to.

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Hire more of A and less of B

Hire more of B and less of A

Start paying factor A more

Try to use factor B more productively

"The quantity demanded increases as its price increases and falls as its price falls" is called given goods, is presented by.

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Allen

Marshall

Adam smith

Robert griffin

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