Question 1

A perfectly competitive firm is a price taker because

Accepted Answer

A)  The price of the product is determined by many buyers and sellers.
B)  It has market power.
C)  Market supply is upward-sloping.
D)  Its products are differentiated.E) A) and D)
F) B) and C)

Question 2

The decision to start or expand a business is known as the

Accepted Answer

A)  Output decision.
B)  Investment decision.
C)  Production decision.
D)  Profit maximization decision.E) C) and D)
F) All of the above

Question 3

Discuss the characteristics of a perfect competitive industry and which real-life industries come closest to this type of market structure.

Accepted Answer

The companies in a perfectly competitive...

Question 4

An In the News article discusses "Too Many Sellers: The Woes of T-Shirt Shops." If T-shirt shops are perfectly competitive firms, then

Accepted Answer

A)  The barriers to entry are low.
B)  Shops can definitely earn an economic profit in the long run.
C)  There are few T-shirt shops.
D)  Each shop has market power.E) A) and D)
F) All of the above

Question 5

The market price for T-shirts sold in a perfectly competitive market is determined by

Accepted Answer

A)  The largest firm in the industry.
B)  Supply and demand.
C)  Government regulation.
D)  Strategic interaction.E) A) and D)
F) B) and D)

Question 6

The $600 paid in property taxes counts as

Accepted Answer

A)  An implicit cost.
B)  A normal cost.
C)  A variable cost.
D)  An explicit cost.E) B) and D)
F) A) and D)

Question 7

A change in which of the following will change the optimal rate of output?

Accepted Answer

A)  Payroll taxes.
B)  Profit taxes.
C)  Property taxes.
D)  Inflation taxes.E) A) and B)
F) All of the above

Question 8

Which of the following does not affect marginal costs?

Accepted Answer

A)  An increase in property taxes.
B)  A decrease in Social Security taxes.
C)  An increase in payroll taxes.
D)  An increase in state unemployment taxes.E) B) and C)
F) None of the above

Question 9

The demand curve confronting a competitive firm

Accepted Answer

A)  Equals the marginal revenue curve.
B)  Is horizontal, as is the market demand curve.
C)  Slopes downward, while the market demand curve is horizontal.
D)  Slopes downward, and the marginal revenue curve is below it.E) C) and D)
F) None of the above

Exam 8: The Competitive Firm

The $600 paid in property taxes counts as

Correct Answer
verified

An In the News article discusses "Too Many Sellers: The Woes of T-Shirt Shops." If T-shirt shops are perfectly competitive firms, then

Correct Answer
verified

A change in which of the following will change the optimal rate of output?

Correct Answer
verified

Which of the following does not affect marginal costs?

Correct Answer
verified

The demand curve confronting a competitive firm

Correct Answer
verified

Discuss the characteristics of a perfect competitive industry and which real-life industries come closest to this type of market structure.

Correct Answer
verified
The companies in a perfectly competitive...
View Answer

A perfectly competitive firm is a price taker because

Correct Answer
verified

The decision to start or expand a business is known as the

Correct Answer
verified

The market price for T-shirts sold in a perfectly competitive market is determined by

Correct Answer
verified

Exam 8: The Competitive Firm

The $600 paid in property taxes counts as

Correct AnswerverifiedShow Answer

An In the News article discusses "Too Many Sellers: The Woes of T-Shirt Shops." If T-shirt shops are perfectly competitive firms, then

Correct AnswerverifiedShow Answer

A change in which of the following will change the optimal rate of output?

Correct AnswerverifiedShow Answer

Which of the following does not affect marginal costs?

Correct AnswerverifiedShow Answer

The demand curve confronting a competitive firm

Correct AnswerverifiedShow Answer

Discuss the characteristics of a perfect competitive industry and which real-life industries come closest to this type of market structure.

Correct AnswerverifiedThe companies in a perfectly competitive...View AnswerShow Answer

A perfectly competitive firm is a price taker because

Correct AnswerverifiedShow Answer

The decision to start or expand a business is known as the

Correct AnswerverifiedShow Answer

The market price for T-shirts sold in a perfectly competitive market is determined by

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The companies in a perfectly competitive...
View Answer

Correct Answer
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Correct Answer
verified

Correct Answer
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