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[iomar]

1.) A measure of profit which takes into account the opportunity cost of producing a firm’s product is called :
a). accounting profit
b). opportunity cost profit
c).economic profit
d). revenue profit

2. A firm’s price per unit is equal to:
a) marginal cost
b) marginal revenue
c)average cost
(d) average revenue

3) The food growing sector of the agriculture industry is:
a.) An oligopoly.
b.) A monopoly.
c.) A competitive industry.
d.) Characterized by monopolistic competition.

4) The Firm is a:
(a) monopoly
(b) oligopoly
(c) duopoly
(d) perfectly competitive firm

5.) Markets that exhibit economies of scale over the entire range of market output:
a) Are natural monopolies.
b) Are perfectly competitive.
c) Have downward sloping short run average total cost curves,
d) Have upward sloping long-run average total cost curves.

6.) The ultimate market constraint on the exercise of market power:
a) Is the demand curve facing the monopolist.
b) Is the ATC curve facing the monopolist.
c) Is MC pricing.
d) Are barriers to entry

7) In monopolistic competition, the entry of new firms will:
a) Cause long run economic profits to be zero.
b) Shift the market supply curve to the right.
c) Shift the firm’s demand curve to the left.
d) All of the above.


8.) Which of the following market structures will have lower output in the long run than will perfect competition, ceteris paribus ?
a) Monopolistic competition.
b) Oligopoly.
c) Monopoly.
d) All of the above.

9.) The purpose of industry concentration indicators like the Herfindahl Index is to provide the Justice Department with a convenient way to:
a) Decide which proposed mergers and acquisitions to challenge based on changes in the structure of a market.
b) Investigate the behavior of firms in a market.
c) Investigate the contestability of a market.
d) Test for the existence of predatory pricing.

10.) Open and explicit agreements concerning pricing and output shares transform an oligopoly into a:
a) Monopoly.
b) Cartel.
c) Differentiated oligopoly.
d) Perfectly competitive firm.

11) When oligopolists coordinate price, the market demand curve will be:
a) Kinked.
b) Perfectly inelastic.
c) Strongly inelastic like a monopolist’s.
d) Elastic.

12.) The pricing strategy in which one firm is allowed by its rivals to establish the market price for all firms in the market is called:
a) Overt collusion.
b) Price leadership.
c) Pattern pricing.
d) Benchmark pricing.

13.) When a monopolistically competitive firm advertises, it is attempting to increase:
a) The demand and decrease the price elasticity of demand for its product.
b) The demand and increase the price elasticity of demand for its product.
c) Long run profits.
d) Market demand.


14.) A shift in the supply curve would be caused by:
a) A change in fixed cost.
b) A change in demand determinants.
c) A change in supply determinants.
d) A change in price.


15.) Barriers to entry into an oligopoly market include:
a) Patents
b) The expense involved in nonprice competition.
c) Control of distribution outlets.
d) All of the above.

Also:
An industry in which a single firm has economies of scale throughout the range of industry output is called a ________________________.
Recently the price of gasoline has been steadily rising. Oil industry experts predict that the price will reach $4.00 per gallon within this year. They make this prediction because they believe that, at a price < $4.00 per gallon, demand for gasoline is relatively price ______________________ .

[jarel]

do your own HW. these questions aren't hard.