Question 1

-In the figure above, the firm's economic

Accepted Answer

A)   loss will be greater than $30 per day.
B)   loss will be $30 or less per day.
C)   profit will be between $0 and $30 per day.
D)   profit will be greater than $30.01 per day.E) A) and D)
F) C) and D)

Question 2

-Fresh Taste, Inc. produces organic breakfast cereals. The market for breakfast cereals is monopolistically competitive. The figure above shows the demand curve that Fresh Taste faces (D) , the company's marginal revenue curve (MR) , its marginal cost curve (MC) , and its average total cost curve (ATC) . Fresh Taste's markup is

Accepted Answer

A)   more than zero but less than $1.00.
B)   $3.00.
C)   $2.00.
D)   zero.E) A) and B)
F) All of the above

Question 3

3 and sets the price at P3. B)  Q2 and sets the price at P2. C)  Q1 and sets the price at P1. D)  Q1 and sets the price at P5." class="answers-bank-image d-inline" rel="preload" >
-In the above figure, the monopolistically competitive firm produces

Accepted Answer

A)   Q3 and sets the price at P3.
B)   Q2 and sets the price at P2.
C)   Q1 and sets the price at P1.
D)   Q1 and sets the price at P5.E) B) and D)
F) A) and B)

Question 4

The efficient scale of a firm is defined as the point where

Accepted Answer

A)   average total cost is minimized.
B)   marginal revenue equals marginal cost.
C)   price equals marginal cost.
D)   marginal revenue equals zero.E) All of the above
F) C) and D)

Question 5

Dole Co. operates in a monopolistically competitive market. Which of the following characterizes Dole Co.'s market?

Accepted Answer

A)   Dole Co. supplies a small portion of the market's output.
B)   Dole Co.'s product is slightly different from its competitors.
C)   Dole Co. faced no barrier to entry when it decided to enter its market.
D)   All of the above describe Dole Co.'s market.E) C) and D)
F) A) and B)

Question 6

In monopolistic competition, a firm has some ability to affect the price for its product because of

Accepted Answer

A)   easy entry and exit.
B)   economic profits.
C)   product differentiation.
D)   many competitors.E) A) and B)
F) A) and C)

Question 7

In monopolistically competitive markets, products are ________ and there ________ barriers to entry.

Accepted Answer

A)   identical; are no
B)   differentiated; are no
C)   identical; are
D)   differentiated; areE) All of the above
F) B) and C)

Question 8

In its long-run equilibrium, a firm in monopolistic competition

Accepted Answer

A)   makes zero economic profit and operates with excess capacity.
B)   makes zero economic profit and produces above capacity output.
C)   makes a positive economic profit and operates with excess capacity.
D)   makes a positive economic profit and produces above capacity output.E) A) and B)
F) A) and C)

Question 9

The Karaoke Channel Online streams professional-grade karaoke for $9.95 a month. Suppose Karaoke Channel Online has a constant marginal cost of $1 per customer and total fixed cost is $20,000. The profit maximizing number of customers is 10,000. Several competitors start to advertise online. Karaoke Channel Online now spends $5,000 a month on advertising and the profit maximizing number of customers increases to 12,000. What is Karaoke Channel Online's average total cost before the advertising begins?

Accepted Answer

A)   $3
B)   $2
C)   $1
D)   $2.66E) A) and B)
F) B) and D)

Question 10

A monopolistically competitive firm and a monopoly are alike because both I. face downward sloping demand curves.
II)  have marginal revenue curves that lie beneath their demand curves.
III)  can make an economic profit in the long run.

Accepted Answer

A)   I only.
B)   I and II.
C)   I, II, and III.
D)   I and III.E) A) and D)
F) A) and C)

Question 11

The market for wheat can be described at perfectly competitive while the market for pizza is better described as monopolistically competitive. Which of the following is a NOT a similarity between perfectly competitive and monopolistically competitive firms?

Accepted Answer

A)   Both monopolistically competitive and perfectly competitive firms produce at their efficient scale.
B)   Both monopolistically competitive and perfectly competitive firms are free to enter and exit the market.
C)   Both monopolistically competitive and perfectly competitive firms have a small market share.
D)   There are a large number of firms in both monopolistically competitive and perfectly competitive markets.E) B) and C)
F) A) and B)

Question 12

-The above figure shows the demand and cost curves for a firm. The figure shows a

Accepted Answer

A)   monopolistically competitive firm in the long run.
B)   perfectly competitive firm earning zero profit.
C)   monopolistically competitive firm in the short run.
D)   perfectly competitive firm in the short run.E) A) and B)
F) C) and D)

Question 13

If a firm spends $600 more on advertising, its goal is for the demand curve for its product to shift ________ and its marginal revenue curve to shift ________.

Accepted Answer

A)   leftward; rightward
B)   leftward; leftward
C)   rightward; leftward
D)   rightward, rightwardE) All of the above
F) C) and D)

Question 14

Which of the following statements is CORRECT for a monopolistically competitive firm in the short run?

Accepted Answer

A)   Its total revenue is maximized.
B)   Its total fixed cost is 0.
C)   Its marginal cost is equal to its marginal revenue.
D)   Its price is equal to its marginal cost.E) B) and D)
F) A) and C)

Question 15

Dole Co. operates in a monopolistically competitive market. To try to earn an economic profit, Dole Co. will

Accepted Answer

A)   prevent other firms from entering the market.
B)   increase its product's price.
C)   continually seek to differentiate its product.
D)   increase output.E) All of the above
F) None of the above

Question 16

-The above figure shows the demand and cost curves for a firm in monopolistic competition. The graph represents the firm's situation in

Accepted Answer

A)   only the short run.
B)   only the long run.
C)   either the short run or the long run.
D)   neither the short run nor the long run.E) B) and D)
F) All of the above

Question 17

The best example of a good sold in a monopolistically competitive market is

Accepted Answer

A)   pizza.
B)   the local newspaper.
C)   sewer services.
D)   peaches.E) None of the above
F) C) and D)

Question 18

-The above figure represents Tony's Pizza Parlor, a firm in monopolistic competition.
a) What quantity will be produced?
b) What price will be charged?
c) What is Tony's total cost?
d) What is Tony's total revenue?
e) What is Tony's economic profit or loss?
f) Is this a long-run equilibrium? Why or why not?

Accepted Answer

a) 40 pizzas per day
b) $12 per pizza
c)...

Question 19

-The above figure is for a firm in monopolistic competition. The diagram represents the short run rather than the long run because the

Accepted Answer

A)   MR curve cuts the ATC curve from below.
B)   MR curve and the D curve do not coincide.
C)   firm is incurring an economic loss.
D)   firm is making an economic profit.E) B) and C)
F) A) and D)

Question 20

The Firefox, Safari, and Opera browsers are an example of ________.

Accepted Answer

A)   products produced in monopoly industries
B)   products produced in perfectly competitive industries
C)   product differentiation
D)   homogeneous productsE) None of the above
F) B) and D)

Exam 14: Monopolistic Competition

The best example of a good sold in a monopolistically competitive market is

Correct Answer
verified

Which of the following statements is CORRECT for a monopolistically competitive firm in the short run?

Correct Answer
verified

Correct Answer
verified

In monopolistically competitive markets, products are and there barriers to entry.

Correct Answer
verified

Correct Answer
verified
a) 40 pizzas per day
b) $12 per pizza
c)...
View Answer

Correct Answer
verified

-The above figure shows the demand and cost curves for a firm in monopolistic competition. The graph represents the firm's situation in

Correct Answer
verified

-The above figure is for a firm in monopolistic competition. The diagram represents the short run rather than the long run because the

Correct Answer
verified

In monopolistic competition, a firm has some ability to affect the price for its product because of

Correct Answer
verified

-In the above figure, the monopolistically competitive firm produces

Correct Answer
verified

The market for wheat can be described at perfectly competitive while the market for pizza is better described as monopolistically competitive. Which of the following is a NOT a similarity between perfectly competitive and monopolistically competitive firms?

Correct Answer
verified

Dole Co. operates in a monopolistically competitive market. To try to earn an economic profit, Dole Co. will

Correct Answer
verified

-In the figure above, the firm's economic

Correct Answer
verified

In its long-run equilibrium, a firm in monopolistic competition

Correct Answer
verified

If a firm spends $600 more on advertising, its goal is for the demand curve for its product to shift and its marginal revenue curve to shift .

Correct Answer
verified

A monopolistically competitive firm and a monopoly are alike because both I. face downward sloping demand curves. II) have marginal revenue curves that lie beneath their demand curves. III) can make an economic profit in the long run.

Correct Answer
verified

The efficient scale of a firm is defined as the point where

Correct Answer
verified

-The above figure shows the demand and cost curves for a firm. The figure shows a

Correct Answer
verified

The Firefox, Safari, and Opera browsers are an example of ________.

Correct Answer
verified

Dole Co. operates in a monopolistically competitive market. Which of the following characterizes Dole Co.'s market?

Correct Answer
verified

Exam 14: Monopolistic Competition

The best example of a good sold in a monopolistically competitive market is

Correct AnswerverifiedShow Answer

Which of the following statements is CORRECT for a monopolistically competitive firm in the short run?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In monopolistically competitive markets, products are ________ and there ________ barriers to entry.

Correct AnswerverifiedShow Answer

Correct Answerverifieda) 40 pizzas per dayb) $12 per pizzac)...View AnswerShow Answer

Correct AnswerverifiedShow Answer

-The above figure shows the demand and cost curves for a firm in monopolistic competition. The graph represents the firm's situation in

Correct AnswerverifiedShow Answer

-The above figure is for a firm in monopolistic competition. The diagram represents the short run rather than the long run because the

Correct AnswerverifiedShow Answer

In monopolistic competition, a firm has some ability to affect the price for its product because of

Correct AnswerverifiedShow Answer

-In the above figure, the monopolistically competitive firm produces

Correct AnswerverifiedShow Answer

The market for wheat can be described at perfectly competitive while the market for pizza is better described as monopolistically competitive. Which of the following is a NOT a similarity between perfectly competitive and monopolistically competitive firms?

Correct AnswerverifiedShow Answer

Dole Co. operates in a monopolistically competitive market. To try to earn an economic profit, Dole Co. will

Correct AnswerverifiedShow Answer

-In the figure above, the firm's economic

Correct AnswerverifiedShow Answer

In its long-run equilibrium, a firm in monopolistic competition

Correct AnswerverifiedShow Answer

If a firm spends $600 more on advertising, its goal is for the demand curve for its product to shift ________ and its marginal revenue curve to shift ________.

Correct AnswerverifiedShow Answer

A monopolistically competitive firm and a monopoly are alike because both I. face downward sloping demand curves. II) have marginal revenue curves that lie beneath their demand curves. III) can make an economic profit in the long run.

Correct AnswerverifiedShow Answer

The efficient scale of a firm is defined as the point where

Correct AnswerverifiedShow Answer

-The above figure shows the demand and cost curves for a firm. The figure shows a

Correct AnswerverifiedShow Answer

The Firefox, Safari, and Opera browsers are an example of ________.

Correct AnswerverifiedShow Answer

Dole Co. operates in a monopolistically competitive market. Which of the following characterizes Dole Co.'s market?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

In monopolistically competitive markets, products are and there barriers to entry.

Correct Answer
verified

Correct Answer
verified
a) 40 pizzas per day
b) $12 per pizza
c)...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

If a firm spends $600 more on advertising, its goal is for the demand curve for its product to shift and its marginal revenue curve to shift .

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified