QUESTION 21

1. If most cartel members keep their agreement to cut back production:

	A	it's not profitable in the short run for another member to increase production.
	B	it's profitable in the short run for another member to increase production.
	C	cheating by another member won't be detected.
	D	the losses associated with cheating are internalized by the cheater.

1 points

QUESTION 22

1. The "short run" is defined as:

	A	the period before any changes in a firm's output can be made.
	B	less than six months.
	C	less than one year.
	D	the period before entry or exit can occur.

1 points

QUESTION 23

1. When the size of the production is the most efficient:

	A	total cost is at the minimum.
	B	average cost is at the minimum.
	C	marginal cost is at the minimum.
	D	fixed cost is at the minimum.

1 points

QUESTION 24

1. Which of the following makes a cartel short-lived?

	A	stable market demand
	B	few firms in the cartel
	C	cheating
	D	contracting

1 points

QUESTION 25

1. According to the text, the demand curve for oil from a particular stripper well is:

	A	flat.
	B	vertical.
	C	upward sloping.
	D	downward sloping.

1 points

QUESTION 26

1. Competitive firms want to produce the quantity such that:

	A	P=MC
	B	P>MC
	C	P>AC
	D	P

1 points

QUESTION 27

1. When a cartel member produces more output and lowers prices:

	A	the entire cartel is made more profitable.
	B	it receives all the benefits of the increased sales and the other members bear the burden of lower profits.
	C	it enjoys only a fraction of the benefits of selling more units.
	D	it bears the entire cost of lower prices.

1 points

QUESTION 28

1. If you buy a lot of apps for your current iPad, and in a few years another device comes out that is superior to it, why might you upgrade to a newer iPad instead of switching?

	A	You don't want to pay to have your Apple tattoo removed.
	B	You have invested in several apps for the iPad that you would have to repurchase for the new platform.
	C	None of the same application are available on the new platform.
	D	You prefer the iPad's higher price.

1 points

QUESTION 29

1. If a single supplier produces such a small portion of the total market output that changes in its production have no impact on the overall market price:

	A	the firm will eventually be force out of business.
	B	demand for the firm's output is perfectly elastic.
	C	the firm's supply curve is perfectly inelastic.
	D	the market supply curve is horizontal.

1 points

QUESTION 30

1. In the long run, competitive firms want to exit industries in which:

	A	P=MC
	B	P>MC
	C	P>AC
	D	P