John is a seller in an affiliated-values auction environment where bidders are risk neutral. Which auction yields John the greatest expected revenue?
A. English
B. Second price
C. First price
D. All of the choices are revenue equivalent.
Answer: A
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Winners of the Jackson City Lottery prize of $10 million are paid $1 million per year for ten years. Paid out in this form, this prize is
a. worth less than $10 million because the payment is deferred over time b. worth more than $10 million because the payments remain constant for the next ten years c. worth more than $10 million because the tax burden on the smaller payments is less d. worth exactly $10 million e. not worth $10 million only if the interest rate is positive
Compared to a monopolistic competitor, a monopoly producer who was currently earning economic profits: a. would face a more elastic demand curve
b. would face a less elastic demand curve. c. could continue to earn economic profits for a longer period of time. d. would be characterized by both (b) and (c).
For a perfectly competitive firm,
a. marginal revenue equals total revenue b. total revenue always exceeds total cost c. price always exceeds average total cost d. marginal cost always equals average cost e. the marginal revenue curve and the demand curve lie on top of each other
If the marginal cost curve is below the average variable cost curve, then
A) average variable costs are increasing. B) average variable costs are decreasing. C) marginal cost must be decreasing. D) average variable costs could either be increasing or decreasing.