Average fixed costs will
A) rise as output rises.
B) fall then rise as output rises.
C) rise then fall as output rises.
D) fall as output rises.
Answer: D
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By reviewing its sales records, Dell economists discover that when Dell lowers the price of its personal computers, the total revenue Dell obtains from the sale of its personal computers rises. Hence
A) supply of Dell personal computers is elastic. B) demand for Dell personal computers is elastic. C) supply of Dell personal computers is inelastic. D) demand for Dell personal computers is inelastic.
What is true at the profit-maximizing quantity for a perfectly competitive firm but not for a nondiscriminating monopoly?
a. Price equals marginal cost. b. Price is greater than marginal cost. c. Marginal revenue equals marginal cost. d. Marginal revenue is less than marginal cost. e. Marginal revenue is greater than average revenue.
Which of the following could cause the production possibilities frontier to shift to the right?
a. More government regulation that stunts economic growth b. Changes in the rules of the game that stunt economic growth c. Lower quality resources d. Fewer productive resources e. Production of more capital goods and fewer consumer goods
If the four-firm concentration ratio in an industry increases, the industry
A. must have become more competitive. B. must have become a monopoly. C. must have become less competitive, although not necessarily a monopoly. D. may or may not have become less competitive.