The output at which average variable cost is a minimum is ________ than the output at which ________ is a minimum
A) the same as; average total cost
B) the same as; marginal cost
C) less than; average total cost
D) less than; marginal cost
C
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If the MPC = 0.75 for a particular person this means that:
A. they will spend 75 cents of each new dollar they get. B. if they receive $1 then they want to spend 25% of it. C. if they receive $1 they want to spend roughly 75%, but probably won't do so. D. they will spend 25 cents of the $1 and save 75 cents.
A demand curve that is perfectly inelastic is
A. Downward-sloping. B. Upward-sloping. C. Horizontal. D. Vertical.
Under oligopoly, if one firm in an industry significantly increases advertising expenditures in order to capture a greater market share, it is most likely that other firms in that industry will:
A. increase the price of the product to improve profits and then increase advertising expenditures. B. decide to increase advertising expenditures even if it means a reduction in profits. C. pursue a strategy to reduce advertising expenditures to maintain profits. D. make no changes in advertising expenditures because advertising is effective in the short run, but not the long run.
Consider an industry that is made up of six firms with the following market shares: Firm A - 50%, Firm B - 20%, Firms C and D - 10% each, and Firms E and F - 5% each. What is the value of the Herfindahl-Hirschman Index?
A) 2,500 B) 3,150 C) 8,100 D) 10,000