Economics Chapter 15 Figure Profits Monopolistic Competition Reference Ref 155

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Question Toby operates a small deli downtown. The deli industry is monopolistically competitive. In the long run,

Toby will produce where:

96. Multiple Choice: Suppose the dry-cleaning market is mo...

Question Suppose the dry-cleaning market is monopolistically competitive and economically profitable this year. In

the long run, the demand for any one firm’s dry-cleaning services will ________ as more firms enter the

industry, causing profits to ________.

97. Multiple Choice: If monopolistically competitive firms…

Question If monopolistically competitive firms are earning positive economic profits in the short run, then in the long

run:

98. Multiple Choice: When a monopolistically competitive f…

Question When a monopolistically competitive firm is making zero economic profits, it is producing at the output

level at which the average total cost curve is tangent to the demand curve faced by the firm. At this output:

99. Multiple Choice: Toby operates a small deli downtown. ...

Question

Points: 0

Toby operates a small deli downtown. The deli industry is monopolistically competitive. If some delis leave

the industry, Toby‘s ________ curve will shift to the ________.

100. Multiple Choice: In monopolistic competition:

Question In monopolistic competition:

101. Multiple Choice: The model of monopolistic competition...

Question The model of monopolistic competition can characterize the market for plumbing services in a city.

Suppose that the market is in long-run equilibrium. For a typical plumbing firm, price:

102. Multiple Choice: The model of monopolistic competition...

Question The model of monopolistic competition can characterize the market for plumbing services in a city. This

market is initially in long-run equilibrium, but then there is an increase in demand for plumbing services. We

expect that in the long run:

103. Multiple Choice: In the long run, monopolistically com...

Question In the long run, monopolistically competitive firms tend to experience:

Points: 0

104. Multiple Choice: In the long run, a monopolistically c...

Question In the long run, a monopolistically competitive firm produces the optimal level of output. Which of the

following must be true for the firm?

105. Multiple Choice: Figure: Possible Long-Run Outcome Ref…

Question Figure: Possible Long-Run Outcome

Reference: Ref 15-3

(Figure: Possible Long-Run Outcome) In the figure Possible Long-Run Outcome, which price and quantity

refer to a potential long-run profit maximizing outcome for a firm producing in a monopolistically competitive

market?

106. Multiple Choice: In the short run, a monopolistically ...

Question In the short run, a monopolistically competitive firm produces at the optimal level of output and is earning

positive economic profits. Which of the following describes how this firm will adjust in the long run?

Points: 0

107. Multiple Choice: In a long-run equilibrium, firms in a…

Question In a long-run equilibrium, firms in a monopolistically competitive industry sell at a price:

Answer equal to marginal cost.

108. Multiple Choice: General Snacks is a typical firm in a…

Question General Snacks is a typical firm in a market characterized by the model of monopolistic competition. If the

market is in long-run equilibrium, then the price General Snacks charges for its snack goods would:

109. Multiple Choice: General Snacks is a typical firm in a…

Question General Snacks is a typical firm in a market characterized by the model of monopolistic competition.

Initially, the market is initially in long-run equilibrium, and then there is an increase in demand for snacks.

In the long run, the economic profits of typical firms in the industry will be:

110. Multiple Choice: Which of the following statements is …

Question Which of the following statements is correct?

Points: 0

111. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) In panel A of the figure Firms in Monopolistic Competition, the

profit–maximizing quantity of output is determined by the intersection at point:

112. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) In panel B of the figure Firms in Monopolistic Competition, the

profit–maximizing quantity of output is determined by the intersection at point:

113. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question

Points: 0

Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) In panel C of the figure Firms in Monopolistic Competition, the

profit–maximizing quantity of output is determined by the intersection at point:

114. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) In panel A of the figure Firms in Monopolistic Competition,

economic profit per unit is:

115. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question

Points: 0

Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) In panel C of the figure Firms in Monopolistic Competition,

economic loss per unit is:

116. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) Look at the figure Firms in Monopolistic Competition. There will

117. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question

Points: 0

Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) Look at the figure Firms in Monopolistic Competition. There will

be zero economic profit earned if the profit–maximizing price is ________ in panel ________.

118. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) Look at the figure Firms in Monopolistic Competition. There will

be a negative economic profit (or an economic loss) earned at the profit–maximizing price ________ in

panel ________.

119. Multiple Choice: Figure: Firms in Monopolistic Competi...

Question

Points: 0

Figure: Firms in Monopolistic Competition

Reference: Ref 15-4

(Figure: Firms in Monopolistic Competition) Look at the figure Firms in Monopolistic Competition. A long-

run equilibrium is illustrated at the profit-maximizing price ________ in panel ________.

120. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) In panel A of the figure Profits in Monopolistic Competition, the

profit–maximizing quantity of output is determined by the intersection at point:

121. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question

Points: 0

Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) In panel B of the figure Profits in Monopolistic Competition, the

profit–maximizing quantity of output is determined by the intersection at point:

122. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) In panel C of the figure Profits in Monopolistic Competition, the

profit–maximizing quantity of output is determined by the intersection at point:

123. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question

Points: 0

Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) Look at the figure Profits in Monopolistic Competition. A

positive economic profit is earned if the profit–maximizing price is ________ in panel ________.

Answer E; B

B; A

A; A

N; C

124. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) Look at the figure Profits in Monopolistic Competition. A zero

economic profit is earned if the profit-maximizing price is ________ in panel ________.

125. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question

Points: 0

Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) Look at the figure Profits in Monopolistic Competition. A

negative economic profit (or economic loss) is earned if the profit-maximizing price is ________ in panel

________.

126. Multiple Choice: Figure: Profits in Monopolistic Compe...

Question Figure: Profits in Monopolistic Competition

Reference: Ref 15-5

(Figure: Profits in Monopolistic Competition) Look at the figure Profits in Monopolistic Competition. A long-

run equilibrium is illustrated at the profit-maximizing price ________ in panel ________.

127. Multiple Choice: Figure: The Restaurant Market Referen...

Question

Points: 0

Figure: The Restaurant Market

Reference: Ref 15-6

(Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant

in a community. Assume that many firms, differentiated products, and easy entry and easy exit

characterize the restaurant market. The restaurant shown here will maximize profits at quantity:

128. Multiple Choice: Figure: The Restaurant Market Referen...

Question Figure: The Restaurant Market

Reference: Ref 15-6

(Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant

in a community. Assume that many firms, differentiated products, and easy entry and easy exit

characterize the restaurant market. For the restaurant shown here, the profit–maximizing price is:

Points: 0

129. Multiple Choice: Figure: The Restaurant Market Referen...

Question Figure: The Restaurant Market

Reference: Ref 15-6

(Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant

in a community. Assume that many firms, differentiated products, and easy entry and easy exit

characterize the restaurant market. For the restaurant shown here, the profit per unit is:

130. Multiple Choice: Figure: The Restaurant Market Referen...

Question Figure: The Restaurant Market

Reference: Ref 15-6

(Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant

in a community. Assume that many firms, differentiated products, and easy entry and easy exit

characterize the restaurant market. If the restaurant shown here were to raise its price above the profit–

maximizing price, it would experience:

Points: 0

131. Multiple Choice: Figure: The Restaurant Market Referen...

Question Figure: The Restaurant Market

Reference: Ref 15-6

(Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant

in a community. Assume that many firms, differentiated products, and easy entry and easy exit

characterize the restaurant market. If the restaurant shown here is typical of others in the community, then

in the long run, we would expect to observe:

Answer restaurants leaving the market.

132. Multiple Choice: Figure: The Restaurant Market Referen...

Question Figure: The Restaurant Market

Reference: Ref 15-6

(Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant

in a community. Assume that many firms, differentiated products, and easy entry and easy exit

characterize the restaurant market. In long-run equilibrium, the economic profit earned by the typical

restaurant in the community will be:

Points: 0

133. Multiple Choice: The model of monopolistic competition...

Question The model of monopolistic competition can characterize the market for plumbing services in a city.

Suppose that the market is initially in long-run equilibrium, and then there is an increase in demand for

plumbing services. We expect that in the short run:

Answer the price and output of plumbing services will fall.

134. Multiple Choice: Figure: The Market for Gas Stations R…

Question Figure: The Market for Gas Stations

Reference: Ref 15-7

(Figure: The Market for Gas Stations) Look at the figure The Market for Gas Stations. Assume that the

market for gas stations is characterized by many firms, differentiated products, easy entry, and easy exit.

The typical gas station will maximize profits at a quantity of:

Answer Q1.

135. Multiple Choice: Figure: The Market for Gas Stations R…

Question

Points: 0

Figure: The Market for Gas Stations

Reference: Ref 15-7

(Figure: The Market for Gas Stations) Look at the figure The Market for Gas Stations. Assume that the

market for gas stations is characterized by many firms, differentiated products, easy entry, and easy exit.

For the typical gas station the profit-maximizing price would be:

Answer P1.

136. Multiple Choice: Figure: The Market for Gas Stations R…

Question Figure: The Market for Gas Stations

Reference: Ref 15-7

(Figure: The Market for Gas Stations) The figure Market for Gas Stations shows curves facing a typical gas

station in a large town. The market is characterized by many firms, differentiated products, easy entry, and

easy exit. If the gas station shown here were to raise its price above the profit-maximizing price, it would

experience:

Points: 0

137. Multiple Choice: Figure: The Market for Gas Stations R…

Question Figure: The Market for Gas Stations

Reference: Ref 15-7

(Figure: The Market for Gas Stations) The figure The Market for Gas Stations shows curves facing a typical

gas station in a large town. The market is characterized by many firms, differentiated products, easy entry,

and easy exit. If the gas station here is typical of others in the community, then in the long run, we would

expect to observe:

138. Multiple Choice: Figure: The Market for Gas Stations R…

Question Figure: The Market for Gas Stations

Reference: Ref 15-7

(Figure: The Market for Gas Stations) The figure The Market for Gas Stations shows curves facing a typical

gas station in a large town. The market is characterized by many firms, differentiated products, easy entry,

and easy exit. If the gas station here is typical of others in the community, prices charged by firms in the

market are likely to:

Points: 0

139. Multiple Choice: Figure: The Market for Gas Stations R…

Question Figure: The Market for Gas Stations

Reference: Ref 15-7

(Figure: The Market for Gas Stations) Look at the figure The Market for Gas Stations. This market is

characterized by many firms, differentiated products, easy entry, and easy exit. In long-run equilibrium, the

economic profit earned by the typical gas station in the community will be:

140. Multiple Choice: The model of monopolistic competition...

Question The model of monopolistic competition can characterize the market for plumbing services in a city. This

market is initially in long-run equilibrium, but then there is an increase in demand for plumbing services. We

expect that in the long run, the economic profits of typical firms in the industry will be:

141. Multiple Choice: General Snacks is a typical firm in a…

Question General Snacks is a typical firm in a market characterized by the model of monopolistic competition.

Initially, the market is in long-run equilibrium, and then there is an increase in demand for snacks. In the

short run the price of snacks will ________ and the output of services will ________.

Points: 0

142. Multiple Choice: General Snacks is a typical firm in a…

Question General Snacks is a typical firm in a market characterized by the model of monopolistic competition.

Initially, the market is initially in long-run equilibrium, and then there is an increase in demand for snacks.

We expect that:

143. Multiple Choice: Figure: Monopolistic Competition II R…

Question Figure: Monopolistic Competition II

Reference: Ref 15-8

(Figure: Monopolistic Competition II) Which of the panels in the figure Monopolistic Competition II shows a

monopolistic competitor earning a loss in the short run?

144. Multiple Choice: Figure: Monopolistic Competition II R…

Question Figure: Monopolistic Competition II

Reference: Ref 15-8

(Figure: Monopolistic Competition II) Which of the panels in the figure Monopolistic Competition II shows a

monopolistic competitor earning a profit in the short run?

Points: 0