Download 11extra - U of L Class Index

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
Use the figure below to answer the following question(s).
Figure 11.2
1) Refer to Figure 11.2, which graphs a perfectly competitive firm's total revenue and total cost curves. Which one of
the following statements is false? 1) _______
A) At an output above Q3 units a day, the firm incurs an economic loss.
B) At an output less than Q1 units a day, the firm incurs an economic loss.
C) At an output of Q1 units a day, the firm makes zero economic profit.
D) Total profit is seen as the vertical distance by which the total revenue curve exceeds the total cost curve.
E) At an output of Q2 units a day, the firm incurs an economic loss.
Use the figure below to answer the following question(s).
Figure 11.8
2) Figure 11.8 illustrates the cost curves for a perfectly competitive firm. The current market price is $11, and the firm
has the plant size shown by SRAC1. The firm's short- run equilibrium output is 2) _______
A) 17 units.
B) 7 units.
C) 18 units.
D) 9 units.
E) 10 units.
3) Refer to Figure 11.8. The current market price is $11 and the firm has the plant size shown by SRAC1. In the long
run, the firm will 3) _______
A) maintain its current plant size, and other firms will enter the industry.
B) increase its plant size, and other firms will exit the industry.
C) increase its plant size, and other firms will enter the industry.
D) maintain its current plant size, and other firms will exit the industry.
E) exit from the industry.
4) Refer to Figure 11.8. The long-run equilibrium price and quantity combination is 4)
A) $6 and 17 units.
B) $8 and 9 units.
C) $6 and 7 units.
D) $8 and 18 units.
E) $9 and 7 units.
5) Economic efficiency involves 5) _______
A) sacrificing environmental quality.
B) producing a given output at minimum average cost.
C) using the newest available technology.
D) increasing market demand.
E) external economies.
6) Total efficiency is achieved when 6) _______
A) producers cannot lower the cost of producing a given output.
B) all the gains from trade have been realized.
C) consumers cannot make themselves better off by reallocating their budgets.
_______
D) all of the above.
E) none of the above.
7) Consumer efficiency occurs when 7) _______
A) price equals marginal utility.
B) consumers cannot become better off by reallocating their budget.
C) the quantity bought is at a point below the demand curve.
D) price equals average revenue.
E) marginal revenue equals average cost.
1) E
2) E
3) C
4) A
5) B
6) D
7) B