1) An increase in market price, given a fixed number of firms, causes market sup
ID: 1099726 • Letter: 1
Question
1) An increase in market price, given a fixed number of firms, causes market supply to shift to the right.
True
False
2)
In a perfectly competitive market, an increase in market demand in a long-run constant-cost industry causes:
an increase in price, quantity, and profit in the short run.
an increase in price, quantity, and profit in the long run.
a decrease in price, a decrease in quantity, and a decrease in profit in the short run.
a decrease in price, a decrease in quantity, and a decrease in profit in the long run.
3)
If MR = MC, a monopolist should:
decrease production.
increase production.
maintain the same level of production.
stop producing.
4)
For a natural monopoly:
ATC > MC.
ATC< MC.
ATC = MC.
there is no relationship between ATC and MC.
aan increase in price, quantity, and profit in the short run.
ban increase in price, quantity, and profit in the long run.
ca decrease in price, a decrease in quantity, and a decrease in profit in the short run.
da decrease in price, a decrease in quantity, and a decrease in profit in the long run.
Explanation / Answer
1)True
2)d)a decrease in price, a decrease in quantity, and a decrease in profit in the long run
3)c)maintain the same level of production
4)b)ATC< MC
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