When a firm sees average costsstart to increase as production increases, this is known as __________.

• diseconomies of scale
• increasing total costs
• a firm's shut down point
• scope of production

Ben's Bagels charges $10 per dozen bagels and he sells 30 dozen bagels each day.Ben's costs of production total $150 each day. Ben recently quit his job where he earns $100 per day in order to open his bagel store.

Ben's accounting profit per day would be __________.

• $300
• $50
• $450
• $150

Which of the scenarios below is an example of a monopoly?

• In this industry, it is easy to enter and exit themarket.
• A company produces a lemon-lime soda that is identical to others on the market in terms of taste but has a recognizable brand because of advertising.
• This industry has stable pricing due to the tendency of groups of firms to work together to set prices.
• A company engages in predatory price cutting in order to discourage any competition.

Marginal cost is equal to the __________.

• total cost minus fixed costs
• average total cost minus the fixed cost
• change in total cost involved with producing one more unit
• average fixed cost plus average variable cost

The additional income acompany generates from selling one more unitdue to this is called which of the following?

• Diseconomies of scale
• Output effect
• Break even point
• Price effect

Select the statement that is true about perfect competition.

• In perfect competition, firms have the power to set their own prices.
• There are many real-world examples of perfect competition.
• Perfect competition is a simplified view of a market.
• With perfect competition, information is withheld about the market.

Which statement below is NOT true about the long run average supply curve?

• The long run supply curve consists of the minimum points of short run supply curves.
• The long run supply curve consists of MC from the shutdown point onward.
• The shape of the long run curve is due to economies and diseconomies of scale.
• The long run supply curve must be equal to or lie below the short term supply curve.

When a firm uses five machines, it can produce 600 units daily.Asixth machine allows the firm to product 880 units.

Which of the following is true regarding production?

• The marginal product for the fifth machine is 600 and the average product is 120 units.
• The total production for 11 machineswould be 1,480 units with an average production of 164 units.
• The marginal product for the sixth machine is 280 units and the average product is 147 units.
• The marginal production for the sixth machineis 880 units and total production would be 1,480 units.

The Prisoner's Dilemma can come into play when firms ___________.

• are regulated by the government in order to provide fair pricing to consumers
• are forced to advertise and market their goods to consumers
• decide whether to work together on things like price or production levels
• engage in predatory pricing to move each other out of the market

Select the definition that represents an oligopoly.

• A model that explains why price fixing tends to break down
• When firms work together to determine the price and number of products
• A market structure that consists of a few firms that all sell similar products
• A group of firms engaged in price fixing

If the variable costs for a firm are $57, the fixed costs are $143, and the firm sells 40 units, what are the firm's average total costs?

• $10.00
• $25.00
• $5.00
• $20.00

Which of the following is true regarding how a market type interacts with constant, increasing and decreasing cost industries?

• In a natural monopoly, firms will always reach diseconomies of scale at high levels of output.
• In a perfectly competitive market, firms tend to experience diseconomies of scale at relatively low levels of output.
• In a perfectly competitive market, firms will usually experience significant economies of scale until very high levels of output.
• In a monopoly, firms are likely to begin experiencing diseconomies of scale at relatively low levels of output.

Which of the following is NOT a trait of monopolistic competition?

• Imperfect information
• Firms do not produce at minimum cost
• Easy entry and exit to and from the market
• Barriers to entry

When sales double, a pizza restaurant finds its costs for sauce, dough and electricity increase, because these are __________.

• fixed costs
• sunk costs
• variable costs
• implicit costs