Essay on Microeconomics Quiz Review

2103 WordsNov 2, 20139 Pages
Chapter 9 1. All firms, no matter what type of firm structure they are producing in, make their production decisions based on where: marginal revenue equals marginal costs. 2. According to the table below, when profits are maximized, profits are equal to: $2. 3. Many economists believe that the market for wheat in the United States is an almost perfectly competitive market. If one firm discovers a technology that makes their wheat taste better and have fewer calories than all other wheat offered in the market, the wheat market would become less competitive because: the products would no longer be similar in the wheat market. 4. When talking about economics profits in a perfectly competitive market, the difference between the…show more content…
short-run market supply; left; increase. 21. Which of the following lists the three main characteristics of a competitive market? many buyers and sellers, similar products, easy entry into the market 22. Total revenue minus total cost equals: profit. 23. A firm participating in a competitive market with costs described in the table below would always shut down: if the price is equal to $2. 24. When revenue is insufficient to cover cost, the firm suffers a loss. 25. Sunk costs: are costs that have been incurred as a result of past decisions. 26. According to the figure below, this firm would shut down in the long run if: the price fell below $5. 27. One difference between implicit costs and explicit costs is that: explicit costs are included in accounting profits, whereas implicit costs are not. 28. Holding all else constant, an increase in the price of hot dogs would cause: the marginal revenue (MR) curve in the market for hot dog buns to decrease. 29. Marginal revenue is: the change in total revenue when the firm produces additional units. 30. According to the figure below, if the firm is maximizing profits, profit is represented by the area: (A – B) × C. 31. Firms will always stay in the market if: the price they charge is greater than their minimum average variable cost (AVC). 32.

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