Question:

If the monopolist incurs losses in the short run, then in the long run

A.

the monopolist will go out of business

B.

the monopolist will stay in business

C.

the monopolist will break even

D.

any of the above is possible.

Answer» d. any of the above is possible.

Question:

The best level of output for the monopolist is

A.

AC is minimum

B.

TC=TR

C.

TR and TC are parallel

D.

TR is maximum

Answer» c. TR and TC are parallel

Question:

When AR = AC, firm is at:

A.

Supernormal profit point

B.

Loss making point

C.

Breakeven point

D.

Minimise losses point

Answer» c. Breakeven point

Question:

The market structure Perfect mobility of factors and products is called

A.

Perfect competition

B.

Monopoly

C.

Monopolistic competition

D.

Oligopoly

Answer» a. Perfect competition

Question:

If the monopolist incurs loss in the short run, then in the long run

A.

The monopolist go out of business

B.

The monopolist will stay in the business

C.

The monopolist break even

D.

Any of the above

Answer» d. Any of the above

Question:

Break-even point is a point where price is equal to

A.

AC

B.

AVC

C.

AFC

D.

MC

Answer» a. AC

Question:

Which of the following industries most closely approximates the perfectly competitivemodel?

A.

Automobile

B.

cigarette

C.

newspaper

D.

wheat farming.

Answer» d. wheat farming.

Question:

A perfectly competitive firm gets only normal profit when

A.

MC = MR

B.

AC = AR

C.

AC < AR

D.

MC = AR

Answer» b. AC = AR

Question:

The economic incentive for price discrimination depends on:

A.

prejudices of business managers.

B.

differences among sellers\ costs.

C.

a desire to evade antitrust legislation.

D.

differences among buyers\ demand elasticities.

Answer» d. differences among buyers\ demand elasticities.

Question:

Competition “among the few” is often called as:

A.

Duopoly

B.

Perfect competition

C.

Bilateral monopoly

D.

Oligopoly

Answer» d. Oligopoly