Economics MCQs

Page No. 178

In monopolistic competition of firms are making abnormal profit other firms will enter and ?


aThe marginal cost will shift outwards

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bthe demand curve will shift inwards

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cThe average cost will shift downwards

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dThe average variable cost will increase

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Which of the following is not one of the four Ps in marketing ?


aProduct

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bPrice

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cPlace

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dPresence

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View Answer Product

in long-run equilibrium in a competitive market, firms are operating at ?


athe minimum of their average-total-cost curves

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ball of these answers are correct

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ctheir efficient scale

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d zero economic profit

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If an input necessary for production is in limited supply so that an expansion of the industry raises costs for all existing firms in the market, then the long-run market supply curve for a good could be ?


a perfectly inelastic

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bperfectly elastic

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cupward sloping

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ddownward sloping

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View Answer upward sloping

In the long-run some firms will exit the market if the price of the good offered for sale is less than ?


amarginal revenue

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bmarginal cost

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caverage total cost

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daverage revenue

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View Answer average total cost

A grocery store should close at night if the ?


avariable costs of staying open are less than the total revenue due to staying open.

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b total costs of staying open are less than the total revenue due to staying open

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cvariable costs of staying open are greater than the total revenue due to staying open

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dtotal costs of staying open are greater than the total revenue due to staying open

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In the short run, the competitive firm’s supply curve is the portion of the marginal cost curve that lies above the average variable cost curve?


aUpward-sloping portion of the average total cost curve

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bupward-sloping portion of the average variable cost curve

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c portion of the marginal cost curve that lies above the average total cost curve.

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dportion of the marginal-cost curve that lies above the average variable cost curve

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The competitive firm maximize profit when it produces output up to the point where ?


aprice equals average variable cost

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bmarginal revenue equals average revenue

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cmarginal cost equals total revenue

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dmarginal cost equals marginal revenue

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If a competitive firm doubles its output its total revenue ?


adoubles

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bmore than double

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c less than doubles.

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dcannot be determined because the price of the good may rise or fall

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View Answer doubles

Which of the following is not a characteristic of a competitive market ?


a All of these answers are characteristic of a competitive market

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bThe are many buyers and sellers in the market

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cThe goods offered for sale are largely the same.

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dFirms generate small but positive economic profits in the long run

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