WorksheetsEnergy Markets 4
Total questions: 10
Worksheet time: 5mins
How does an increase in WACC influence the EMV?
Depends on the party (government or company)
It will always increase EMV
It will always decrease EMV
It does not influence EMV at all
What is not a method for transforming resources to reserves?
Rising prices of the resource
New extraction technologies
Discovery of new resources
Decreasing cost of extraction
How do companies act in Cournot competition?
They maximise profits over prices they take from their competition
They maximise profits over quantity given the expected costs of their competitors
They maximise profits over prices given the expected costs of their competitors
They maximise the social benefit forming a cartel with their competitors
Compared to a monopoly, the perfect market does not offer:
Lower prices
Higher quantity
Higher consumer surplus
Higher producer surplus
How are quantities and prices in a duopoly compared to the monopoly (M) and perfect market (PM)?
Prices: Lower than M, higher than PM
Quantities: Lower than M, higher than PM
Prices: Lower than M, higher than PM
Quantities: Higher than M, lower than PM
Prices: Higher than M, higher than PM
Quantities: Lower than M, lower than PM
Prices: Lower than M, lower than PM
Quantities: Higher than M, higher than PM
Where do market prices usually lie compared to SRMC and LRMC?
In between them
Higher than LRMC and SRMC
Higher than LRMC
Lower than SRMC
What does usually happen to SRMC and LRMC in the case of a field dropping out?
Both of them increase
One of them increases
Both of them decrease
One of them decreases
What is not part of a boom & bust cycle?
Some producers facing losses
All producers making profit
Entry of new participant & exit of old ones
Prices decreasing below the SRMC
What is not a base assumption of perfect markets?
Many buyers and sellers
Suppliers are price-takers
Market power of participants
Homogeneous goods
Which key characteristic makes energy markets relatively complicated?
Oligopol structure
Inelastic demand meets inelastic supply
Volatility of prices
Cost structure with high fixed costs
