Question details

Eco550 FINAL_EXAM 1 & 2
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  • Question 1

5 out of 5 points

   

Correct

In the linear breakeven model, the difference between selling price per unit and variable cost per unit is referred to as:

Answer

     

Selected Answer:

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contribution margin per unit

Correct Answer:

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contribution margin per unit

     
  • Question 2

0 out of 5 points

   

Incorrect

A ____ total cost function implies that marginal costs ____ as output is increased.

Answer

     

Selected Answer:

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linear; increase linearly

Correct Answer:

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linear; are constant

     
  • Question 3

5 out of 5 points

   

Correct

The short-run cost function is:

Answer

     

Selected Answer:

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relevant to decisions in which one or more inputs to the production process are fixed

Correct Answer:

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relevant to decisions in which one or more inputs to the production process are fixed

     
  • Question 4

5 out of 5 points

   

Correct

In a study of banking by asset size over time, we can find which asset sizes are tending to become more prominent.  The size that is becoming more predominant is presumed to be least cost. This is called:

Answer

     

Selected Answer:

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survivorship analysis.

Correct Answer:

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survivorship analysis.

     
  • Question 5

0 out of 5 points

   

Incorrect

In determining the shape of the cost-output relationship only ____ depreciation is relevant.

Answer

     

Selected Answer:

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time

Correct Answer:

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usage

     
  • Question 6

5 out of 5 points

   

Correct

The main difference between perfect competition and monopolistic competition is:

Answer

     

Selected Answer:

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The degree of product differentiation

Correct Answer:

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The degree of product differentiation

     
  • Question 7

5 out of 5 points

   

Correct

An "experience good" is one that:

Answer

     

Selected Answer:

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Has undetectable quality when purchased

Correct Answer:

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Has undetectable quality when purchased

     
  • Question 8

0 out of 5 points

   

Incorrect

All of the following are true for both competition and monopolistic competition in the long run, except one of them.  Which is it?

Answer

     

Selected Answer:

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The barriers to entry and exit are relatively easy

Correct Answer:

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P = MC

     
  • Question 9

5 out of 5 points

   

Correct

If price exceeds average costs under pure competition, ____ firms will enter the industry, supply will ____, and price will be driven ____.

Answer

     

Selected Answer:

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more; increase; down

Correct Answer:

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more; increase; down

     
  • Question 10

0 out of 5 points

   

Incorrect

In the long-run, firms in a monopolistically competitive industry will

Answer

     

Selected Answer:

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earn substantial economic profits

Correct Answer:

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tend to just cover costs, including normal profits

     
  • Question 11

5 out of 5 points

   

Correct

Regulatory agencies engage in all of the following activities except _______.

Answer

     

Selected Answer:

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setting federal and state income tax rates on regulated firms

Correct Answer:

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setting federal and state income tax rates on regulated firms

     
  • Question 12

0 out of 5 points

   

Incorrect

In natural monopoly, AC continuously declines due to economies in distribution or in production, which tends to found in industries which face increasing returns to scale.  If price were set equal to marginal cost, then:

Answer

     

Selected Answer:

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price would exceed average cost.

Correct Answer:

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price would equal average cost.

     
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