10 pointsQUESTION 2The supply curve of a perfectly competitive

QUESTION 2

  1. The supply curve of a perfectly competitive

firm is:

the portion of the marginal cost curve above the marginal revenue curve.the portion of the marginal cost curve above the average cost curve.the portion of the marginal cost curve above the average variable cost curve.the portion of the average cost curve above the average variable cost curve.the same as the average variable cost curve.10 points  

QUESTION 3

  1. Demand for a good is given by: QD = 100 – P and supply by QS = 1.4P – 20, where P is the market price of the good. In equilibrium, price would be ___.

10 points  

QUESTION 4

  1. Suppose a severe freeze damages the Florida orange crop. Everything else remaining unchanged, which of the following is most likely to be true?
  2. Because of the shortage of oranges, consumers will reduce their demand in order to economize.
  3. The supply curve for oranges will shift to the right.
  4. Both the output and the price of oranges will decrease.
  5. Both the supply curve and the demand curve for oranges will shift to the left.
  6. The output of oranges will fall and the price will increase.

10 points  

QUESTION 5

  1. For a perfectly competitive firm, long-run average cost is: LAC = 300 – 20Q + 1Q2, where Q denotes the firm’s output. The firm’s long-run profit-maximizing output is _____.10 points  

QUESTION 6

  1. The marginal cost of a firm under perfect competition is given by the equation MC = 2QF − 20. The market price is $43 per unit. Determine the firm’s profit-maximizing level of output.

10 points  

QUESTION 7

  1. Demand for a good is given by: QD = 100 – P and supply by QS = 0.9P – 20, where P is the market price of the good. In equilibrium, output under perfect competition will be ____.

10 points  

QUESTION 8

  1. The price of fresh fish rose and the quantity sold fell. Other things remaining the same, which of the following is consistent with this observation?
  2. The number of consumers that have a preference for fish increased.
  3. The price of meat, which is a substitute for fish, rose.
  4. The fishermen learned to fish more efficiently.
  5. The cost of fishing increased.
  6. The supply of fresh fish increased.

10 points  

QUESTION 9

  1. In a perfectly competitive market, an individual firm faces a demand curve that:
  2. is downward sloping.
  3. lies above the marginal revenue curve.
  4. is horizontal at the equilibrium price.
  5. is perfectly inelastic.
  6. is upward sloping.

10 points