Which of the following is true about an imperfectly competitive firm’s marginal revenue (MR) curve if it has a linear and downward-sloping demand curve?

MR decreases and is less than demand.

MR decreases at an increasing rate.

MR increases at first, then decreases.

The market for space travel has the possibility to be very profitable, but it is also likely to be imperfectly competitive. Which of the following is the most likely reason that the space travel industry is imperfectly competitive?

low minimum efficient scale relative to the size of the market

Which of the following is true about production in an imperfectly competitive market? Choose 1 answer:

Less is produced than is socially optimal.

The amount produced minimizes marginal cost.

The amount produced minimizes average total cost.

More is produced than is socially optimal.

The amount produced is the same as in perfect competition.

Priya’s Party Supplies sells cake toppers in a market with many other sellers, but each seller has their own version of cake toppers. Which of the following statements is true based on this information?

Priya’s marginal revenue curve is less than her demand curve.

Priya produces a socially optimal quantity.

Priya produces in a perfectly competitive industry.

Priya can charge whatever price she wants to for her cake toppers.

Priya’s average total cost curve is below her average variable cost curve.

If a firm must lower its price to sell more of a good, which of the following must also be true?

Its marginal revenue curve is lower than its demand curve.

Its marginal revenue curve is the same as its marginal cost curve.

Its marginal revenue curve is upward-sloping.

Its marginal revenue curve is equal to its demand curve.

Its marginal revenue curve is higher than its average total cost curve.

For the firm shown in the graph above, the short- run, profit-maximizing strategy would be to set output at:

Q1, price at P3, and earn an economic profit

Q1, price at P1, and suffer a loss

Q2, price at P2, and earn an economic profit

Q2, price at P2, and earn only a normal profit

For an unregulated monopolist, the profit-maximizing quantity will always be:

in the elastic region of the demand curve

where marginal revenue equals price

where price equals average total cost

where the marginal cost curve intersects the demand curve

For the unregulated, single-price monopoly shown in the figure above, when its profit is maximized, output will be

4 units per year and the price will be $6.

4 units per year and the price will be $4.

6 units per year and the price will be $4.

None of the above answers is correct.

A monopoly can price discriminate between two groups of consumers if each group has

a different willingness to pay.

the ability to resell the good to the other group.

Which of the following statements correctly identifies a difference between perfect competition and monopolistic competition?

In perfect competition the firms all sell products that are exactly the same, but in monopolistic competition each firm sells a slightly differentiated product.

In perfect competition there are no barriers to entry, but there are strong barriers in monopolistic competition.

In perfect competition there are many firms, but in monopolistic competition there are only a few firms.

In perfect competition there are few consumers, but in monopolistic competition there are many consumers.

Monopolistically competitive firms are considered inefficient in allocating society’s resources for which of the following reasons?

In long-run equilibrium, the price is greater than the marginal cost.

In long-run equilibrium, the marginal benefit exceeds the price charged by the firms.

In long-run equilibrium, average total costs are minimized.

In long-run equilibrium, the firm is earning economic profits.

Which of the following is true of a monopolistically competitive firm in long-run equilibrium?

Price equals average total cost but is greater than marginal cost.

Price equals marginal cost and average total cost.

Price equals marginal cost and is greater than average total cost.

The firm earns positive economic profits by producing at minimum average cost.

The graph shows a monopolistically competitive firm:

making a profit in the short-run

incurring a loss in the short-run

making a profit in the long-run

A monopolistically competitive firm advertises in order to:

make the demand for its product less price elastic

shift the demand curve for its product to the left

make its product more similar to its competitors’

reduce the industry’ s barriers to entry

Product differentiation refers to

Features that make one product appear different from competing products in the same market.

The selling of identical products in different markets.

AP Microeconomics Unit 4

Quiz

•

Social Studies

•

10th Grade - University

•

Practice Problem

•

Medium

Brent Pfeiffer

Used 273+ times

FREE Resource

93 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The graph shows a(n):

oligopsony

monopoly

monopsony

perfectly competitive factor market and firm

2.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

What does marginal mean in the language of economics?

Additional

Less

Satisfaction

I can't believe it's not Butter.

3.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

What does utility mean in the language of economics?

Additional

Less

Satisfaction

I can't believe it's not Butter.

4.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

If every consumers needs are being met perfectly and every good that is being made is being sold, what type of efficiency is being achieved?

Productive Efficiency

Allocative Efficiency

5.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

When there is only one seller of a good or service, they are said to have a?

Monopoly

Oligarchy

Monopolistic Competition

Perfect Competition

6.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

When there are only a few sellers of a type of produce, like Smart phones, there is said to be an?

Monopoly

Oligopoly

Monopolistic Competition

Perfect Competition

7.

MULTIPLE CHOICE QUESTION

5 mins • 1 pt

When there is lots of competition in a market because the barriers to entry are low and there are many substitutes that exist, this is called?

Monopoly

Oligopoly

Monopolistic Competition

Perfect Competition

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AP Microeconomics Unit 4

93 questions

The graph shows a(n):

What does marginal mean in the language of economics?

What does utility mean in the language of economics?

If every consumers needs are being met perfectly and every good that is being made is being sold, what type of efficiency is being achieved?

When there is only one seller of a good or service, they are said to have a?

When there are only a few sellers of a type of produce, like Smart phones, there is said to be an?

When there is lots of competition in a market because the barriers to entry are low and there are many substitutes that exist, this is called?

Laws that are meant to stop monopolies from forming are called?

Price fixing and collusion often occur in this type of market structure

The airline industry is most likely in the market structure called

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