Exam 11: Price and Output in Monopoly, Monopolistic Competition, and Perfect Competition

-The information in Exhibit K-11 shows that if the firm produces 11 units of output, itstotal revenue would equal

If total explicit costs are equal to total implicit costs, then economic profit is zero.

According to your text, nineteenth century economist Alfred Marshall believed that technical progress is best accomplished by

The firm in a perfectly competitive industry

-In Exhibit K-6, how much profit does the monopoly make when it produces 7 units?

If a perfect competitor is currently charging $9 for its product and the marginal cost of the last unit produced is $6, the firm should

When compared to monopoly and monopolistic competition, the perfectly competitive market structure

Sam quits his job as an airline pilot and opens his own pilot training school. He was earning $40,000 as a pilot. He withdraws $10,000 from his savings where he was earning 6 percent interest and uses the money in his new business. He uses a building he owns as a hangar that he could have rented out for $5,000 per year. He rents a computer for $1,200,buys office supplies for $500, rents an airplane for $6,000, pays $1,300 for fuel andmaintenance, and hires one worker for $30,000. Sam's total revenue from pilot training classes equaled $90,400. Sam's implicit costs for this year are equal to

A monopolist's goal is to maximize profit.

Economists agree that large firms with big research budgets create most of the economy's technological progress

-In Exhibit K-7, the marginal cost of the fourth unit is

How can a perfectly competitive firm that makes (along with its competitors) zero economic profit create positive economic profit in the short run? It can

-Exhibit K-8 indicates that a monopolist maximizes profit at a quantity of

Schumpeter believes that monopolies use their economic profit to

If a monopolist draws a set of cost and revenue curves to represent the firm, he would show that

A perfectly competitive firm's long-run supply curve is that part of its MC curve that lies above the point where MC = AVC.

Remember-from the Added Perspective-Elaine Rodier who quit her job to go into business making appetizers? Which of the following is an implicit cost for her business?

To maximize profit, a perfectly competitive firm will produce where MR = MC, but a monopoly and a monopolistically competitive firm will produce where price = ATC.

According to economist Joseph Schumpeter, technological advance is more likely to occur in a monopoly than in perfect competition.

A monopolist faces a demand curve that is