Solve the following questions correctly.,,,

Section A: MULTIPLE CHOICE QUESTIONS: Choose the one alternative that best answers the question. 1) For a market to be perfectly competitive, there must be... elganing A) Many buyers and sellers, with all firms selling identical products, and no barriers to new firms entering the market. B) Many buyers and sellers, with all firms selling identical products, and substantial barriers to new firms entering the market. C) Many buyers and one seller, with the firm producing a product that has no close substitutes, and barriers to new firms entering the market. D) Many buyers and a small number of firms that compete, selling differentiated products and mo barriers to new firms entering the market. 2) A market structure in which there is no competition is referred to as a(n) omdent mexi A) monopolistically competitive market B) monopoly C) perfect competition Dj oligopoly 3) Compared to a firm under perfect competition, a monopolist A) charges less and produces less B) charges more and produces more C) charges more and produces less D) charges less and produces more 4) Which of the following statements is true? A) A perfectly competitive firm faces an upward-sloping demand curve. B) A monopolist can increase the price of its product and not lose all of its business. C) A perfectly competitive firm can increase the price of its product without losing its business. D) A monopolist faces an upward-sloping demand curve. 5) If a firm can sell 15 units of output for $10 each or 14 units at $12 each, the additional revenue from selling the fifteenth unit is A) $150 B) $18 C)-$18 D) -$12Cost 151 Quantity of Output 6) In the figure above which letter represents the average variable cost curve and the average fixed cost curve? A)A &B B) B & C OC &D DID & A 7) The long-run average total cost (LRATC) shown below exhibits Long-Run Average Total Cost LRATC Output A) constant returns to scale over all levels of output B) economies of scale over all levels of output C) diseconomies of scale over all levels of output D) none of the aboveECON 105 Principles of Microet Service in s The following figure represents the cost and revenue curves of a firm that is produc produ A) an inc B) an info monopoly market. Market 1 Price MC ATC D Q, Q2 0, 0, 05 Quantity 8) Refer to the figure above. What is the optimal quantity that the monopolist should produce? A) 2 B) Q5 D) 04 9) Which of the following statements is true? A) In the long run, a firm can vary all its inputs, B) In the long run, a firm cannot vary any of its inputs. C) In the short run, a firm can vary all its inputs. D) In the short run, a firm cannot vary any of its inputs. 10) occur when average total cost falls as the quantity produced increases. A) Economies of scale B) Diseconomies of scale C) Decreasing marginal returns D) Increasing marginal returns 1 1) The negative value of the price elasticity of demand for a good can be attributed to A) the Law of Demand B) the Law of Increasing Marginal Utility C) the Law of Supply D) the Law of Diminishing Marginal Rate of Substitution12) If a 5 percent increase in income leads to a 10 percent decrease in quantity demanded for a product, this product is A) an income elastic good. B) an inferior good. C) a necessity. D) a luxury good. 13) The demand curves for good A and B are depicted in the following graph. We can conclude that Price Quantity A) good A is perfectly clastic B) the price elasticity of demand for good A is smaller than good B C) good A is perfectly inelastic. D) the price elasticity of demand for good A is larger than good B 14) When the price of milk is $3 per bottle, Steve consumes 20 bottles of milk. When the price increases to $6, Steve's consumption falls to 15 bottles. Therefore, Steve's are elasticity of demand for milk is A) -0.43 B) -0.75 C) -0.50 D) -0.25 15) From a firm's point of view, when the demand for a good has a price elasticity of 0.5, then, all things remaining the same, a(n) _ A) change in the price of the good will not affect the firm's revenue B) increase in the price of the good will decrease the firm's revenue C) change in the price of the good will not affect the quantity demanded of the good by consumers D) increase in the price of the good will increase the firm's revenue 16) Gary consumes 10,000 kilowatt-hours of electricity when his income is $500. When his income increases to $1,000, his consumption of electricity increases to 18,000 kilowatt-hours. What is Gary's income elasticity of demand for electricity? A) 2 B) 0.8 C) 1.8 D) 0.5