AC231

1) If the marginal cost of producing one more unit is lower than the average total cost, the average total cost will:

• A) Increase

• B) Decrease

• C) Remain constant

• D) Double

2) Antitrust policies are designed to:

• A) Promote monopolistic practices

• B) Eliminate all forms of competition

• C) Prevent monopolies and promote competition

• D) Increase barriers to entry

3) Is a market structure consisting of a firm that is the only seller of a good or service that does not have a close substitute.

• A)    Demand       

•  B) Market   

• C) Monopoly 

• D) Elasticity

4) A monopoly sets its price where:

• A) Marginal cost equals marginal revenue

• B) Price equals marginal cost

• C) Demand equals supply

• D) Total revenue equals total cost

5) The marginal revenue for a perfectly competitive firm is always equal to the market price.

• True

• False