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25 Cards in this Set
- Front
- Back
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T/F Firm's product demand in a competetive industry is downward sloping
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F
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T/F when a monopoly maximizes its profits, price exceed marginal cost
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T
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T/F A monopoly will always produce more than a competetive industry with identical costs
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F
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T/F producer surplus equals profits plus fixed costs
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T
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T/F For a given tax assessed on producers, market price changes more if demand is more inelastic
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T
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T/F When marginal cost is greater than average variable cost, average variable cost must be rising
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T
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T/F the shut down for a competetive firm is reached when the market price falls to the minimum of AVC ( average variable cost)
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T
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In the long run, if price is greater than the average total cost in an industry, then..
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some firms will be attracted to the industry
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a competetive market is
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one in which a single firm cannot influence market price
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A monopoly will produce quantity of output for which..
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marginal revenue equals marginal cost
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Average fixed cost..
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decreases as output rises
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Which of the following does not change with the level of output..
A- total costs B- fixed costs C- average total costs D- marginal cost E- varable costs |
B
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T/F when MC is > than the AVC, AVC must be rising
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T
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T/F the shutdown point for a competetive firm is reached when the market price falls to the minimum AVC
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T
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T/F Firms product demand in a competetive industry, like market demand, is downward sloping
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F
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T/F For a monopoly, price can reman greater than average cost in the long run
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T
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T/F monopolies transfer some of the potential consumer surplus from buyers to sellers
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T
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T/F the gvt can correct a negative externality by giving a subsidy
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F
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T/F for a given tax assessed on prodcuers, market price changes the most if demand is perfectly inelastic and supply is perfectly elastic
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T
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when a tax is assessed on producers..
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the product price typically will not rise by the full amt of the tax
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constant returns to scale occur when..
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an increasing in all resources results in exactly proportionate increases in output
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AS firms enter a competetive industry..
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price falls and industry output increases
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When a negative externality occurs
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social costs are greater than private costs
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A positive externality raises..
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marginal social benefits above marginal private benefits
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in the long run a competetive firm..
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charges a price equal to the minimum average total cost
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