1.Determine and analyze; what will happen to the market supply if a firm with a supply schedule possessing positive units at every price leaves a market, ceteris paribus?

a. It will become more elastic essentially

b. At every price, It will shift right by that firm's output quantity

c. It will not change

d. At every price, it will shift left or decrease by that firm's output quantity

e. Not enough data to determine

2.Company M & M produces its product in a perfectly competitive market that is in long-run equilibrium. What will occur if while increasing its output it lowers its price ?

a. Its PS [producer surplus] will essentially increase, yet, CS [consumer surplus] will decrease by a greater amount

b. It would increase its revenue and profit; take business from its competitors

c. It would incur economic losses

d. It would start to develop market power, and as this occur, it would be making its market imperfectly competitive

e. It would essentially increase revenue but increase costs by the same amount

f. Indeterminate

3.From the following policies listed below, which would most likely help a government to essentially achieve a goal of minimizing / reducing the wealth gap between people with no wealth and people with great wealth ?

a. Switching to a progressive tax system from a regressive tax system

b. Increasing / elevating the interest rate on bank loans

c. Increasing / elevating the nation's per capita income

d. Lowering / minimizing taxes on income from interest earned on investments

e. Encouraging and enhancing actions that yield the increased returns to entrepreneurs

f. A and C

4.Which of the following choices is correct and rational about a monopsonistic market?

a. There can be said to be one supplier and many buyers

b. The resources are efficiently allocated

c. The average cost of labor and supply curve [horizontal] are equal

d. Just like in a perfectly competitive market, monopsony has the same quantity transacted [as perfectly competitive market]

e. The overall purchase of an additional item will increases the price of the item and also of the existing items being essentially purchased.

5.Which of the following models illustrates the connection and relationships between quantities and price and the overall relative benefits of the producers and consumers in a market over period of time?

a. Total utility

b. Asymmetric information

c. Marginal cost

d. Supply and demand

e. Circular flow

f. Production possibility curve

6. If the the total revenue a businesses collect increases due to an increase in a product's price; which of the following must be true?

a. The market seen is not perfectly competitive

b. For its product, exchange is in the inelastic part of the demand curve

c. The firm is essentially charging too much in this scenario

d. Product's elasticity coefficient must essentially be greater than one for this range

e. For its product, exchange is in the elastic part of the demand curve

7.Essentially, in the short run; a firm's TC [total cost] is settled at $150 if it doesn't produce any units of output. The VC[ variable cost] is settled at $5 per unit. Under this means, if the firm was to produce 5 units, variable costs would be [________], while total costs would be [________].

a. $10

b. $40; $25

c. $5; $50

d. $25; $775

e. $25; $175

f. $5; $70

g. None of the above.

8.If the price of cellular service decreased in the cell phone market, what demand curve shift would occur essentially?

a. The demand curve would not shift, although the quantity demanded of cell phones would increase

b. The demand curve would not shift, although the quantity demanded of cell phones would decrease

c. The quantity demanded would remain constant along with the demand for the cell phones

d. Cell phones demand would take a shift to the left

e. Cell phones demand would shift to the right

f. Not enough information

9.As a monopolist engages / works upon perfect price discrimination. What would occur to the consumer surplus?

a. Its converted to producer surplus completely / entirely

b. Based on the elasticity of demand, it decreases

c. It becomes DWL [deadweight loss] and disappears

d. It does not change, it is unchanged essentially

e. As it absorbs the producer surplus, it significantly increases

10.What would be the marginal product of the last worker employed, if the wage in a perfectly competitive labor market is $16 and the firm can sell all the output it wants at $2 per unit.....

a. 5 units

b. 8 units

c. 6 units

d. 14 units

e. indeterminate

f. 32 units

g.18 units