Question 16

A monopolist produces 14,000 units of output and charges $14 per unit. Its MR is $10, its MC is $10, its ATC is $12 and AVC is $9, then at the optimal output level, average fixed cost is:

Select one:

a.

$5

b.

$1

c.

$2

d.

$3

Question 17

A perfect competitive firm sells its product at $23, its ATC is $25 and its AVC is $20, If it produces 500 units of output, then its total loss is:

Select one:

a.

$10,000

b.

$1,000

c.

$1500

d.

$2500

Question 19

Perfect competitive firmis a price maker.

Select one:

True

False

Question 20

A pure monopoly does not have to worry about suffering losses because it has the power to set prices at any level it desires.

Select one:

True

False

Question 21

IATA (the International Air Transport Association) is an example of :

Select one:

a.

An oligopoly.

b.

Monopoly.

c.

Perfectly competitive firms.

d.

Price leadership model.

Question 22

A monopolist produces 14,000 units of output and charges $14 per unit. Its MR is $10, its MC is $10, its ATC is $12 and AVC is $9, then total profit is:

Select one:

a.

$56000

b.

$28000

c.

$70000

d.

$14000

Question 23

If a firm sells its output on a market characterized by a many sellers and many buyers of a differentiated product, then the firm is a:

Select one:

a.

Oligopoly

b.

Monopolistic competitor

c.

Monopolist.

d.

Perfectly competitive

Question 24

If a firm sells its output in a market that is characterized by many sellers and buyers, a homogeneous product and easy entry and exit, then the firm is a :

Select one:

a.

Perfect Competitive.

b.

Monopolistic Competitor.

c.

Oligopoly

d.

Monopolist.

Question 25

A competitive firm that is losing should immediately close out in the short run.

Select one:

True

False