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When the price of a good falls, the ratio of the marginal ut

Paper help Economics When the price of a good falls, the ratio of the marginal ut

Economics

When the price of a good falls, the ratio of the marginal ut

When the price of a good falls, the ratio of the marginal utility of that good divided by its price… Show more When the price of a good falls, the ratio of the marginal utility of that good divided by its price ________ and as a result, consumers purchase ________ of that good. (Points : 5) rises; more falls; more rises; less falls; less Maxine has a fixed income per month to spend on goods and services, so in allocating her limited income over a set of goods, she should purchase the goods that: (Points : 5) have the highest utility regardless of price. have the highest marginal utility. provide the most utility per dollar spent. have equal marginal utilities. The graph of a budget constraint shows the quantities of two goods, X and Y, that a consumer can purchase given the consumer’s income and the prices of the two goods. If the price of the good X decreases, the budget line will: (Points : 5) shift outward and to the right. pivot outward and to the right along the X-axis indicating a greater quantity of X can be purchased. pivot outward and to the right along the Y-axis indicating a greater quantity of Y can be purchased. shift inward and to the left. As output increases, average fixed costs: (Points : 5) decrease. initially decrease and then increase. remain constant. increase. If a firm’s production process exhibits economies of scale for all levels of output, then the firm’s long-run average cost curve will be: (Points : 5) horizontal. positively sloped. negatively sloped. U-shaped. Which of the following is a reason why the marginal product increases as output increases: (Points : 5) decreasing repetition. increasing continuity. both A and B neither A nor B One of the main differences between the long run and the short run is that: (Points : 5) the firm can earn a profit. the firm can operate at a loss. there are no diminishing returns in the short run. there are no diminishing returns in the long run. Every point on the long-run average cost curve represents: (Points : 5) the minimum cost at which the associated output level can be produced when the scale of plant can be changed. the minimum point of the associated short-run average cost curve. the minimum cost at which the associated output level can be produced when the scale of plant cannot be changed. The law of diminishing returns applies in the: (Points : 5) short run and the long run. long run but not the short run. short run only. long run only. both A and B All of the following are possible reasons for diseconomies of scale EXCEPT: (Points : 5) bureaucratic inefficiency. a top-heavy management structure. indivisible inputs. All of the above are possible reasons for diseconomies of scale. Fixed costs: (Points : 5) are not opportunity costs. must be paid even if the firm’s output is zero. are always the largest portion of total costs. none of the above With respect to price, in a perfectly competitive market, firms can: (Points : 5) affect the market price. set the market price. take the market price negotiate the market price to certain extent. If a firm is indifferent between operating and shutting down in the short run, then it must be true that: (Points : 5) total revenue equals total cost. total revenue equals total variable cost. total revenue equals fixed cost. fixed cost is zero. Which one of the following is a good example of an increasing-cost industry? (Points : 5) apartments sugar mining all of the above A firm suffering economic losses decides whether or not to produce in the short run on the basis of: (Points : 5) whether revenues cover variable costs. whether future profits will allow it to recover fixed costs. whether revenues from operating are sufficient to cover fixed costs. whether revenues from operating are sufficient to cover fixed plus variable costs. In a perfectly competitive market: (Points : 5) the government imposes price ceilings on the products produced and buyers and sellers are price takers. buyers set the price and sellers take the price. both buyers and sellers are price takers. the market demand for products produced is perfectly elastic. A perfectly competitive market is one in which: (Points : 5) firms do not attempt to maximize profit. all firms produce the same level of output. all firms sell an homogeneous product. there are only a few firms in the industry. In the form of market organization called “perfect competition,” the firms tend to be ________ and the product they sell is ________. (Points : 5) large; identical small; different large; different Profit-maximizing firms want to maximize the difference between: (Points : 5) total revenue and marginal cost. total revenue and total cost. marginal revenue and marginal cost. marginal revenue and average cost. small; identical If a firm in a perfectly competitive market tries to raise its price above the going market price, then: (Points : 5) it will sell more output. it will sell the same amount of output as before. it will not be able to sell any output. it will sell some output, but not as much as before. Accounting profit is equal to: (Points : 5) total revenue minus economic cost.. total revenue minus accounting cost. total revenue minus explicit costs. total revenue minus implicit costs. For a competitive firm, marginal revenue is ________ price, whereas for a monopolist marginal revenue is ________ price. (Points : 5) equal to; greater than equal to; less than less than; equal to greater than; equal to The tradeoffs faced by a monopolist in cutting price to sell a larger quantity leads to marginal revenue being: (Points : 5) less than price. greater than price. equal to price. none of the above. If a government grants monopoly power through a patent, it may beneficial from a social perspective because: (Points : 5) it may insure less consumer products. it may encourage the development of new products. it may encourage higher standards of professional ethics. it may keep down monopoly profits. A profit-maximizing monopolist will produce an output level at which: (Points : 5) marginal revenue equals marginal cost. On any given day, Disney World can price discriminate and charge local visitors a ________ price for a ticket than out of state visitors because local visitors have a more ________ demand. (Points : 5) lower; inelastic lower; elastic higher; inelastic higher; elastic Assume that Lagyson is the only pharmaceutical company that has a patent in producing insulin. Lagyson can make a profit by selling insulin (Points : 5) in the short run but not in the long run because new firms will enter the industry in the long run. only in the long run because government regulations prevent monopolists from earning profits in the short run. in the long run but not the short run because the monopolist will face competition in the short run. in the long run because entry into the industry by new firms is blocked until the patent expires. • Show less

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