Question 1

Exhibit 8-10   At the profit-maximizing output level, the firm represented in Exhibit 8-10 experiences

Accepted Answer

A) a loss of $3, 200 
B) a profit of $6, 000 
C) a profit of $3, 200 
D) zero profit or loss 
E) a loss of $6, 000 
A) a loss of $3, 200 
B) a profit of $6, 000 
C) a profit of $3, 200 
D) zero profit or loss 
E) a loss of $6, 000

Question 2

Exhibit 8-19 A Single Firm in a Perfectly Competitive Market   Consider Exhibit 8-19.When the market price is P3, which of the following most acurately reflects the firms short-run situation?

Accepted Answer

A) The firm will choose to produce quantity Q3 and earn exactly 0 profit 
B) The firm will choose to produce quantity Q3 and earn a profit 
C) The firm will choose to produce quantity Q3 and suffer a loss 
D) The firm will choose to produce quantity Q5 and earn a profit > 0 
E) The firm will choose to produce quantity Q5 and earn exactly 0 profit 
A) The firm will choose to produce quantity Q3 and earn exactly 0 profit 
B) The firm will choose to produce quantity Q3 and earn a profit 
C) The firm will choose to produce quantity Q3 and suffer a loss 
D) The firm will choose to produce quantity Q5 and earn a profit > 0 
E) The firm will choose to produce quantity Q5 and earn exactly 0 profit

Question 3

Exhibit 8-17   For the perfectly competitive firm represented in Exhibit 8-17, the short-run supply curve is

Accepted Answer

A) abcde 
B) bcde 
C) cde 
D) de 
E) abcd 
A) abcde 
B) bcde 
C) cde 
D) de 
E) abcd

Question 4

Exhibit 8-6   Consider Exhibit 8-6.At which price will this firm shut-down?

Accepted Answer

A) P1 
B) P2 
C) P3 
D) P2 or P3 
E) will never shut-down 
A) P1 
B) P2 
C) P3 
D) P2 or P3 
E) will never shut-down

Question 5

If, as a result of a change in demand in a perfectly competitive increasing-cost industry, price and quantity rise, demand must have risen

Accepted Answer

A) True 
 B)False

Question 6

Exhibit 8-10   In Exhibit 8-10, total cost at the profit-maximizing output level equals

Accepted Answer

A) $4, 800 
B) $6, 000 
C) $2, 800 
D) $3, 600 
E) $4, 000 
A) $4, 800 
B) $6, 000 
C) $2, 800 
D) $3, 600 
E) $4, 000

Question 7

Exhibit 8-16   Which of the following statements about the perfectly competitive firm represented in Exhibit 8-16 is false?

Accepted Answer

A) Short-run losses are maximized at output level q* because MR = MC there. 
B) The firm should shut down in the short run. 
C) If the firm shuts down in the short run, it will suffer a loss equal to the amount of its fixed cost. 
D) If the firm operates in the short run, it will suffer a loss greater than the amount of its fixed cost. 
E) If the firm operates in the short run, it will suffer a loss equal to the amount of its fixed cost plus the uncovered portion of its variable cost. 
A) Short-run losses are maximized at output level q* because MR = MC there. 
B) The firm should shut down in the short run. 
C) If the firm shuts down in the short run, it will suffer a loss equal to the amount of its fixed cost. 
D) If the firm operates in the short run, it will suffer a loss greater than the amount of its fixed cost. 
E) If the firm operates in the short run, it will suffer a loss equal to the amount of its fixed cost plus the uncovered portion of its variable cost.

Question 8

Exhibit 8-10   In Exhibit 8-10, total revenue at the profit-maximizing output level equals

Accepted Answer

A) $8, 000 
B) $3, 600 
C) $12, 000 
D) $4, 800 
E) $18, 000 
A) $8, 000 
B) $3, 600 
C) $12, 000 
D) $4, 800 
E) $18, 000

Question 9

If an industry is a constant-cost industry

Accepted Answer

A) prices of its inputs increase even though output remains constant 
B) it uses inputs at higher levels of output 
C) prices of its inputs rise at a constant rate as it uses more inputs 
D) prices of its inputs remain constant as the number of firms increases 
E) firms in the industry experience economies of scale 
A) prices of its inputs increase even though output remains constant 
B) it uses inputs at higher levels of output 
C) prices of its inputs rise at a constant rate as it uses more inputs 
D) prices of its inputs remain constant as the number of firms increases 
E) firms in the industry experience economies of scale

Question 10

In Connecticut, the apple market is perfectly competitive.Suppose that consumer tastes change so that the market demand for apples increases.In that case, the demand curves faced by individual firms will

Accepted Answer

A) not change 
B) become less elastic 
C) shift upward 
D) shift leftward 
E) shift downward 
A) not change 
B) become less elastic 
C) shift upward 
D) shift leftward 
E) shift downward

Exhibit 8-10 At the profit-maximizing output level, the firm represented in Exhibit 8-10 experiences

Exhibit 8-19 A Single Firm in a Perfectly Competitive Market Consider Exhibit 8-19.When the market price is P₃, which of the following most acurately reflects the firms short-run situation?

Exhibit 8-17 For the perfectly competitive firm represented in Exhibit 8-17, the short-run supply curve is

Exhibit 8-6 Consider Exhibit 8-6.At which price will this firm shut-down?

If, as a result of a change in demand in a perfectly competitive increasing-cost industry, price and quantity rise, demand must have risen

Exhibit 8-10 In Exhibit 8-10, total cost at the profit-maximizing output level equals

Exhibit 8-16 Which of the following statements about the perfectly competitive firm represented in Exhibit 8-16 is false?

Exhibit 8-10 In Exhibit 8-10, total revenue at the profit-maximizing output level equals

If an industry is a constant-cost industry

In Connecticut, the apple market is perfectly competitive.Suppose that consumer tastes change so that the market demand for apples increases.In that case, the demand curves faced by individual firms will

The Art and Science of Economic Analysis

Appendix--Understanding Graphs

Economic Tools and Economics Systems

Economic Decision Makers

Demand, Supply, and Markets

Elasticity of Demand and Supply

Appendix--Price Elasticity and Tax Incidence

Consumer Choice and Demand

Appendix--Indifference Curves and Utility Maximization

Production and Cost in the Firm

B--Perfect Competition

A--Monopoly

B--Monopoly

Monopolistic Competition and Oligopoly

Resource Markets

Labor Markets and Labor Unions

Capital, Interest, and Corporate Finance

Transaction Costs, Imperfect Information, and Behavioral Economics

Economic Regulation and Antitrust Policy

Public Goods and Public Choice

Externalities and the Environment

Income Distribution and Poverty

International Trade

International Finance

Economic Development

Filters

Exam 8: A--Perfect Competition

Exhibit 8-10 At the profit-maximizing output level, the firm represented in Exhibit 8-10 experiences

Exhibit 8-19 A Single Firm in a Perfectly Competitive Market Consider Exhibit 8-19.When the market price is P3, which of the following most acurately reflects the firms short-run situation?

Exhibit 8-17 For the perfectly competitive firm represented in Exhibit 8-17, the short-run supply curve is

Exhibit 8-6 Consider Exhibit 8-6.At which price will this firm shut-down?

If, as a result of a change in demand in a perfectly competitive increasing-cost industry, price and quantity rise, demand must have risen

Exhibit 8-10 In Exhibit 8-10, total cost at the profit-maximizing output level equals

Exhibit 8-16 Which of the following statements about the perfectly competitive firm represented in Exhibit 8-16 is false?

Exhibit 8-10 In Exhibit 8-10, total revenue at the profit-maximizing output level equals

If an industry is a constant-cost industry

In Connecticut, the apple market is perfectly competitive.Suppose that consumer tastes change so that the market demand for apples increases.In that case, the demand curves faced by individual firms will

The Art and Science of Economic Analysis

Appendix--Understanding Graphs

Economic Tools and Economics Systems

Economic Decision Makers

Demand, Supply, and Markets

Elasticity of Demand and Supply

Appendix--Price Elasticity and Tax Incidence

Consumer Choice and Demand

Appendix--Indifference Curves and Utility Maximization

Production and Cost in the Firm

B--Perfect Competition

A--Monopoly

B--Monopoly

Monopolistic Competition and Oligopoly

Resource Markets

Labor Markets and Labor Unions

Capital, Interest, and Corporate Finance

Transaction Costs, Imperfect Information, and Behavioral Economics

Economic Regulation and Antitrust Policy

Public Goods and Public Choice

Externalities and the Environment

Income Distribution and Poverty

International Trade

International Finance

Economic Development

Filters

Exhibit 8-19 A Single Firm in a Perfectly Competitive Market Consider Exhibit 8-19.When the market price is P₃, which of the following most acurately reflects the firms short-run situation?