ECO 204 Week 4 Quiz. Get an A++.

1.Question :All but which one of the following are true of monopolistic competition?

 Student Answer: 

MR = MC 

  P>MC 

 AR = MR 

  The demand curve the firm faces slopes downward. 

  Entry is easy. 

 Points Received:1 of 1 

 Comments:

 2.Question :At the point of long-run equilibrium for a perfectly competitive firm,

 Student Answer: 

 economic profits are zero. 

  TR > TC. 

  TR < TC. 

  P = AVC. 

  normal profits are zero. 

 Points Received:1 of 1 

 Comments:

 3.Question :The greater the price elasticity of the demand curve that the firm faces in monopolistic competition,

 Student Answer: 

 the higher the degree of competition in the industry. 

  the lower the degree of competition in the industry. 

  the fewer substitutes for the good produced. 

  the easier it is for the firm to raise its price. 

  the less sales the firm will gain from a price decrease. 

 Points Received:1 of 1 

 Comments:

 4.Question :Retail outlets operate in which of the following market structures?

 Student Answer: perfect competition 

 monopolistic competition 

  oligopoly 

  monopoly 

  oligopsony 

 Points Received:1 of 1 

 Comments:

 5.Question :Which one of the following is NOT a basic assumption of the model of perfect competition?

 Student Answer: Many buyers 

  Many sellers 

 A differentiated product 

  Full information 

  Mobile resources 

 Points Received:1 of 1 

 Comments:

 6.Question :A firm in a(n) industry will have the most elastic demand curve.

 Student Answer: monopolistic 

  oligopolistic 

  monopolistically competitive 

 perfectly competitive 

 Points Received:1 of 1 

 Comments:

 7.Question :The marginal cost curve above the minimum average variable cost

 Student Answer: indicates points where the firm will realize an economic profit. 

  covers the area where a firm should shut down. 

  is equal to the firm's marginal revenue curve. 

 is the firm's short-run supply curve. 

 Points Received:1 of 1 

 Comments:

 8.Question :A firm in a monopolistically competitive industry faces a downward-sloping demand curve because

 Student Answer: the product is homogeneous. 

 the product is differentiated. 

  nonprice competition is missing. 

  barriers to entry are high. 

 Points Received:1 of 1 

 Comments:

 9.Question :Along a downward-sloping monopoly demand curve,

 Student Answer: marginal revenue is greater than price. 

  elasticity of demand is constant. 

 marginal revenue decreases when price decreases. 

  marginal revenue is equal to zero when price is equal to zero. 

 Points Received:1 of 1 

 Comments:

 10.Question :Perfect competition is

 Student Answer: not an abstraction from reality; it is reality. 

 an "ideal type"—that is, a model or guidepost for comparison. 

  the only market structure in the United States. 

  the best of all possible worlds. 

  found in the U.S. steel industry. 

 Points Received:1 of 1