1. Because a price maker has control over the level of output it produces and the price it charges, it can select from a number of different combination of output and price levels that will maximize its profits.

True

False

2. Because barriers to entry limit the amount of competition in various markets, government policy should be designed to reduce or eliminate such barriers wherever possible.

True

False

3 Efforts by firms to secure more patents will increase the amount of competition in the affected markets

True

False

4 Assume a perfectly competitive firm is currently producing 800 units of output, at that output, P=$10, MC = $10, ATC = $8, and AVC =$6. In this case, the firm's TR and TC are $8,000 and $6,400 respectively

True

False

5 Assume aperfectly competitive firm is currently producing 800 units of output, at the output, P=$10, MC =$10, ATC =$8, and AVC =$6. In this case, the firms is maximizing it profit, which equals $1,600

True

False

6 The monopoly characteristics of monopolistically competitive firms ensures that such firms will earn positive economic profits over the long run

True

False