FINC 306 Sophia __ Microeconomics Unit 3 Milestone 3. Score 18/21. Passed this Milestone.

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7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 1/14 UNIT 3 — MILESTONE 3 Score 18/21 You passed this Milestone 18 questions were answe... red correctly. 3 questions were answered incorrectly. 1 Which of the scenarios below is an example of a monopoly? A company engages in predatory price cutting in order to discourage any competition. 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. In this industry, it is easy to enter and exit the market. CONCEPT Monopoly 2 Which of the following describes an industry that experiences economies of scale, even at high levels of output? Monopolistic competition7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 2/14 Oligopoly Natural monopoly Perfectly competitive industry CONCEPT Constant, Increasing and Decreasing Cost Industries 3 If the variable costs for a firm are $40,000, the fixed costs are $20,000, and the firm sells 100 units, what are the firm's average total costs? $20,000 $400 $600 $60,000 CONCEPT Cost: Total, Marginal and Average 47/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 3/14 This firm is currently producing at 25 units; which of the following should it do in order to maximize profit? The firm should do nothing. It is already producing at maximum optimization. The firm should shut down production entirely. The firm should increase output to 80 units. The firm should decrease output. CONCEPT Output Optimization: Marginal Revenue / Marginal Cost 5 Number of Employees Total Production Marginal Product of Labor Marginal Revenue Product 0 0 0 1 9 9 2 24 15 3 36 127/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 4/14 4 43 7 If the price of the item is $15.00 per unit and the employees cost $125 each, how many employees should the firm hire to maximize their profit? Two employees One employees Three employees Four employees CONCEPT Output Optimization: Marginal Revenue Product 6 Which of the following is true about the long run average cost curve? The long run average cost curve is comprised of all the lowest points of each of the short run average cost curves because no firm will operate at a level of higher per-unit costs in the long run than in the short run. The long run average cost curve can be found as the MC from above the shut down point onward. The long run average cost curve cannot be equal to or lie below any short run average cost curve because in the short run all factors of production can be variable. The long run average cost curve is shaped like a bell and rises because of economies of scale while falling because of diseconomies. CONCEPT Long-Run Supply Curve 77/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 5/14 When a firm uses four machines, it can produce 300 units daily. A fifth machine allows the firm to product 440 units. Which of the following is true regarding production? The marginal production for the fifth machine is 440 units and total production would be 740 units. The total production for nine machines would be 740 units with an average production of 123.33 units. The marginal product for the fifth machine is 140 units and the average product is 88 units. The marginal product for the fourth machine is 300 and the average product is 75 units CONCEPT Product: Total, Marginal, Average, and (Marginal) Revenue 8 Product Price Unit Cost Units Sold Units Produced Opportunity Cost $40.00 $10.00 200 1100 $850 Given the information in the table shown above, the accounting profit is which of the following? -$3,000 $8,000 -$2,150 $11,000 CONCEPT Economic Profit7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 6/14 9 Given the graph shown here, when is the firm operating at a short run loss? When MC (the purple line) is greater than Q1 At Q2 Between Q1 and Q2 At Q1 CONCEPT Shut-down Point 10 Which type of market structure has many small firms that spend money in order to differentiate their products through advertising? Oligopoly7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 7/14 Monopolistic competition Monopoly Perfect competition CONCEPT Monopolistic Competition 11 Using the graph above, the firm is best served producing at __________. Point A Point B Point D7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 8/14 Point C CONCEPT Production Function and Constraints 12 A variable input is one that __________. will change as a result of changes in production will not change over the scope of production will always have increasing costs is highly expensive to change in the long run CONCEPT Production Function and Constraints 13 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. CONCEPT Perfect Competition7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 9/14 14 In which type of market structure might we see firms attempting to collude with one another to set prices? Oligopoly Monopoly Perfect competition Monopolistic competition CONCEPT Oligopoly 157/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 10/14 Based on this graph, what amount should the company choose to produce to maximize profit? 80 71 49 0 65 CONCEPT Output Optimization: Total Revenue / Total Cost 16 Product Price Cost Per Unit Quantity Sold Quantity Produced Opportunity Cost $1.25 $0.75 690 750 100 Using the data in this table, calculate the firm’s economic profit. $320 $200 $300 -$520 -$3007/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 11/14 -$200 CONCEPT Economic Profit 17 Select the definition that represents an oligopoly. A group of firms engaged in price fixing When firms work together to determine the price and number of products A model that explains why price fixing tends to break down A market structure that consists of a few firms that all sell similar products CONCEPT Oligopoly 187/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 12/14 If the market price of apples drops to $9, at which of the following will the firm be? At the shutdown point Just breaking even Operating at a short term loss Below the shutdown point Making a profit CONCEPT Breakeven Point 19 Average total costs are equal to __________.7/27/2020 Sophia :: Welcome https://www.sophia.org/spcc/microeconomics-2/milestone_take_feedbacks/5228729 13/14 fixed costs plus variable costs total cost minus quantity provided marginal cost as production increases average variable plus average fixed costs CONCEPT Cost: Total, Marginal and Average 20 Diseconomies of scale are seen when __________. the marginal cost curve intersects the average cost curve the long run average cost curve is rising the marginal revenue curve intersects the marginal cost curve the fixed cost curve does not change over the scope of production CONCEPT Economies, Constant and Diseconomies of Scale 21 Select the definition of output effect. The revenue that results from selling additional units of a good or service. Market price multiplied by the number of units sold7/27/2020 Sophia :: Welcome The additional revenue from raising the price of a good Amount of revenue lost from lowering the price enough to sell one more unit CONCEPT Revenue: Total, Marginal and Average About Contact Us Privacy Policy Terms of Use [Show More]

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