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Mic-Eco Final Review
Final Review for Micro-Economics - Summer
Question | Answer |
---|---|
A monopolist charges a price that is _______ and produces _______ than a perfect competitor. | higher; less |
Marginal factor cost is computed as... | change in the toal cost of the resource / change in the amount of the resource being used |
For a monopolist, its marginal revenue is always... | less than price |
The first move in the case of price leadership in an oligopolistic industry is uaually taken by | the dominant or larger firm |
Derived demand is... | the demand for the resources that are used to make the products |
In the perfectly competitive world, if P > MC, then... | too few of the product is being made |
Collective bargaining is... | bargaining between unions and management. |
Economies of scale means that... | the long-run average total cost curve is downwawrd sloping |
When oligopolistic companies engage in collusion, the companies are involved in a... | cooperative game |
The time frame in which all factors of production can vary is... | the long run |
A monopolistic firm will shut down if... | P < AVC for every level of output |
When a cartel breaks down and its members start cheating, the industry becomes a... | noncoopoerative game |
When a firm dexperiences declining long-run average total costs as it produces more outputs, it is known as a... | natural monopoly |
What is the short run? | a period of time during which at least on input cannot be changed |
The demand curve for a monopolist is... | the industry demand curve |
The wage rate for labor in a competitive market, absent government interference, is established by... | the supply and demand for labor |
In game theory, actions such as cheating that focus solely on short-run gains are considered to be... | opportunistic behavior |
A monopolistic firm will shut down if... | P < AVC for every level of output |
When a cartel breaks down and its members start cheating, the industry becomes a... | noncoopoerative game |
When a firm dexperiences declining long-run average total costs as it produces more outputs, it is known as a... | natural monopoly |
What is the short run? | a period of time during which at least on input cannot be changed |
The demand curve for a monopolist is... | the industry demand curve |
The wage rate for labor in a competitive market, absent government interference, is established by... | the supply and demand for labor |
In game theory, actions such as cheating that focus solely on short-run gains are considered to be... | opportunistic behavior |
The individual curve for a monopolistic competitor... | slopes downward |
When an American industry outsources some of its production... | both demand and wahes in the industry fall |
A firm that is only a seller of a good with no close substitutes is a(n)... | monopolist |
If a retail food chain merged with a meat packing company, this would be an example of a... | vertical merger |
When total product is increasing at an increasing rate, marginal product is... | positive and increasing |
Advertising intended to reach as many consumers as possible, typically through television, newspaper, or magazine ads is referred to as... | mass marketing |
A company finds that MC = MR at $15, MC = ATC at $20, and MC = MR at $17. Your advice to the firm is... | to continue production at a loss |
The most significant difference between perfect competition and monopolistic competition is that... | in perfect competition the products are homogenous |
Market failure occurs when... | the price system fails to generate an efficient allocation of resources |
Positive externalities arise when... | production of a goodgenerates benefits that spill over to thrid parties |
An economic activity where benefits or costs affect third parties is called... | an externality |
If a corporation were forced to absorb the cost of a spillover from the production of a good, this would likely cause the supply curve for the good to... | shift out |
Why does our governmentenforce antitrust legislation? | Because monopolies are known to be unfair to their stockholders |
The exclusion principle means | no one can be excluded from the benefits of a public good, even if the person does not pay for it |
The average tax rate is defined as... | total tax due / total taxable income |
The US Social Security tax is an example of a... | redressive tax |
The tax that brings in the most revenue in the USA is the... | personal income tax |
State and local governments recieve most of their revenue from... | sales and excise taxes, revenue from the federal government, and property taxes |
The three possible sources of government funding include... | explicit fees, taxes, and borrowings |
The tax base is... | the sum of all incomes earned in the US |
Medicare and Social Security are examples of... | transfer payment programs |
The two basic types of government regulation are... | social regulation and heatlh & safety regulation |
The two most important rationales for government intervention in nonmonopolistic markets are... | market failure and assymetric information |
The theory of regulatory behavior which say that the "regulators" will become eventually controlled by the "regulated" is called... | the demand-pull hypothesis |
In a court decision in 2001, the Federal District Court of Appeals in Washington DC found that Microsoft had violated the... | Sherman Act |
A typical measure of monopoly power that uses the percentage of a particular market that a firm supplies is known as the... | FTC Test |
The wealthiest 10 percent of the population owns about ___ percent of all the wealth in the USA. | 70 |
Poverty is a measure of... | the standard of living |
International trade is based on the existence of... | comparitive advantage |
A government imposed restriction on the quantity of a specific good that may be imported to and sold in the US is called a... | quota system |