Fall 2017 Final Exam ECON 204 ich of the following market structures is characte
ID: 1130600 • Letter: F
Question
Fall 2017 Final Exam ECON 204 ich of the following market structures is characterized by interdependent pricing and output decisions? A. Monopoly B. Oligopoly C. Monopolistic competition. D. Perfect competition. Refer the graph below for Question 16 MC Pc Dermand Quenty MR 16. Refer to the graph shown above. Areas B and D represent: A. the loss of surplus by consumers resulting from a monopoly B. the welfare loss to society from a monopoly C. consumer surplus redistributed to the monopolist. D. the loss of surplus by producers resulting from a monopoly. 17. A monopoly firm selling textbooks to students in a small town is currently maximizing profits by charging a price of S50 per book. It follows that the marginal cost of textbooks is: A. equal to $50. B. less than $50. C. greater than S50. D. greater than the average total cost 18. If the corm industry is perfectly competitive with a market price of S2 per bushel and a com farmer in the industry charges $4 per bushel, how many bushels would the farmer sell? A. some, but fewer than he would at a price of S2 B. more than he would at a price of $2 C. just as many as he would at a price of S2 D. none (or zero) 19. A reduction in the supply of labor will cause wages to: A. decrease and employment to decrease. B. increase and employment to decrease C. increase and employment to increase. D. decrease and employment to increaseExplanation / Answer
Answer:
Q15. Option B. : Oligopoly
Q16. Option B : The welfare loss to society resulting from monopoly
Q17. Option B.: less than 50 because they charge higher than marginal cost.
Q18. Option C. As many as he would at $2. because in perfectly competitive market, there is no limit of supply at a given market rate.
Q19. Option A. Labour and employment both will decrease.
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