1. When a monopolists lowers its price from $20 to $15 the quantity it is able to sell increases from 100 to 200. What is the total change in revenue?

2. When making decisions, one should ignore And focus on.

(A) marginal value, sunk costs

(B) sunk costs, marginal revenue

(C) costs, revenues

(D) marginal costs, marginal revenue

(E) opportunity costs, sunk costs

3. When output is 100 units, a firms total fixed cost is $500. What wills the firms average fixed costs be if the output doubles to 200 units

4. If the MP of labor is positive and it increases as more workers are hired which of the following statements is correct?

(A) All workers are paid the same wages

(B) the firm should definitely reduce the number of workers hired

(C) total output decreases with the number of workers when MP of labor is positive

(D) total output increases with the number of workers when MP of labor is positive

(E) the MC of producing output must be increasing

5. Neither demand nor supply is perfectly inelastic. When tax is imposed, consumer surplus and producer surplus are reallocated to

(A) stockholders

(B) tax revenue and DWL

(C) tax revenue only

(D) DWL only

(E) Wealthy consumers

6. Consider the market for good A, the equilibrium price =$10. Under which of the following conditions that the quantity of good A is smallest?

(A) price ceiling= $11

(B) price floor= $9

(C) price ceiling= $7

(D) price ceiling= $2

(E) price floor= $5

7. Which of the following common characteristics for a monopoly and a competitive market?

(A) in both markers, firms maximize profits

(B) price= MC

(C) price >MC

(D) price

(E) in both markets, firms 0 economic profits in long run

8. Which of the following is a characteristic of a perfectly competitive market?

(A) only one seller

(B) only few sellers

(C) an individual firm can control the market price

(D) easy entry and exit from the market

(E) firms in the market can make long run economic profit

9. When MR is less than MC, a perfectly competitive firm should

(A) increase its price

(B) stay at the same level output

(C) decrees it's price

(D) increase the level of output

(E) reduce the level of output