Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
20th Edition
ISBN: 9780078021756
Author: McConnell, Campbell R.; Brue, Stanley L.; Flynn Dr., Sean Masaki
Publisher: McGraw-Hill Education
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Chapter 13.1, Problem 2QQ
To determine

Average cost of the firm.

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1. Price exceeds MC in:   a. graph (a) only. b. graph (b) only. c. graphs (a) and (b) only. d. graphs (a), (b), and (c). 2. Price exceeds ATC in:   a. graph (a) only. b. graph (b) only. c. graphs (a) and (b) only. d. graphs (a), (b), and (c). 3. The firm represented by Figure 13.1c is:   a. making a normal profit. b. incurring a loss. c. producing at the same level of output as a purely competitive firm. d. producing a standardized product. 4. Which of the following pairs are both “competition-like elements” in monopolistic competition?  a. Price exceeds MR; standardized product. b. Entry is relatively easy; only a normal profit in the long run. c. Price equals MC at the profit-maximizing output; economic profits are likely in the long run. d. A firm’s demand curve is downsloping; differentiated products.
PRICE (dollars per unit) 2 QUANTITY PRICE OR COST (dollars per unit) QUANTITY MC ATC AVC MR Question 40 If the firm in the figure above raised the price of its product abvove $4, the firm would: a. increase its profits b. reduce its total revenue to zero c. increase its total revenue but not its profits because costs would increase. d. not affect revenues at all but profits would increase because costs decrease e. none of the above
II. C
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