Exam (elaborations)

ECON 201 Exam 2

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ECON 201

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ECON 201

In economics, a firm that faces no competitors is referred to as _________________. A. an oligopoly B. a monopoly C. a perfect competitor D. an oligopolizor - answer-B. a monopoly ________________________ arises where many firms are competing in a market to sell similar but differentiated p...

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econ 201 exam 2

Institution ECON 201
Course ECON 201

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ECON 201 Exam 2
In economics, a firm that faces no competitors is referred to as
_________________.
A. an oligopoly
B. a monopoly
C. a perfect competitor
D. an oligopolizor - answer-✔B. a monopoly

________________________ arises where many firms are competing in a market
to sell
similar but differentiated products.
A. Oligopolistic competition
B. Perfect competition
C. Monopolistic competition
D. Monogopolised competition - answer-✔C. Monopolistic competition

A firm's ___________ consist of expenditures that must be made before production
starts that
typically, over the short run, _______________ regardless of the level of
production.
A. fixed costs; do not change,
B. variable costs; are constantly changing,
C. fixed costs; are consistently changing,
D. variable costs; do not change, - answer-✔A. fixed costs; do not change,

,______________ include all of the costs of production that increase with the
quantity
produced.
A. Fixed costs
B. Variable costs
C. Average costs
D. Average variable costs - answer-✔B. Variable costs

____________________________ occur when the marginal gain in output
diminishes as each
additional unit of input is added.
A. Diminishing variable returns
B. Diminishing average returns
C. Diminishing marginal returns
D. Diminishing marginal costs - answer-✔C. Diminishing marginal returns

In order to determine ____________, the firm's total costs must be divided by the
quantity of
its output.
A. diminishing marginal returns
B. fixed costs
C. variable cost
D. average cost - answer-✔D. average cost

In order to determine the average variable cost, the firm's variable costs are divided
by

,_______________________.
A. its' fixed costs
B. the quantity of output
C. its' average costs
D. diminishing marginal costs - answer-✔B. the quantity of output

The term _____________ is used to describe the additional cost of producing one
more unit.
A. average cost
B. fixed cost
C. variable cost
D. marginal cost - answer-✔D. marginal cost

The term __________________ describes a situation where the quantity of output
rises, but
the average cost of production falls.
A. diminishing marginal returns
B. marginal cost output
C. economies of scale
D. diseconomies of scale - answer-✔C. economies of scale

The term "constant returns to scale" describes a situation where
A. expanding all inputs does not change the average cost of production.
B. a larger-scale firm can produce at a lower cost than a smaller-scale firm.
C. expanding all inputs changes the average cost of production.

, D. the quantity of output rises and the average cost of production falls. - answer-
✔A. expanding all inputs does not change the average cost of production.

If a firm is experiencing _____________________, then as the quantity of output
rises, the
average cost of production rises.
A. decreasing returns to scale
B. consent returns to scale
C. economies of scale
D. increasing returns to scale - answer-✔A. decreasing returns to scale

_____________ is calculated by taking the quantity of everything that is sold and
multiplying it by the sale price.
A. Total revenue
B. Total profits
C. Average profit margin
D. Total cost - answer-✔A. Total revenue

Marcella operates a small, but very successful art gallery. All but one of the
following can be
classified as a variable cost arising from the physical inputs Marcella requires to
operate her
business. Which is it?
A. physical space for the gallery
B. costs of purchasing art work to sell in the gallery
C. wages paid to three part-time employees

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