Question 6 Assume that marginal revenue equals rising margin

Question 6 Assume that marginal revenue equals rising marginal cost at 100 units of output At this output level, a proft-maximizing firm\'s total fixed cost is firm will earn an economic profit of Selected Answer $100 Answers: zero. $400 more than zero but less than $100 $100 more than $100

Solution

13.

D

A monopoly market has one firm with unique product with no close substitutes. Besides, there is an entry barrier and other firms cannot enter.

19.

D

It is the case of crony capitalism that makes government to influence business and make the political person to lead the business.

21.

E

It is a case of perfect competition market structure, where the individual demand curve is horizontal and perfectly elastic.

27.

B

A patent right creates exclusivity to the resource and it creates monopoly.

28.

A

Cartel is implicit kind of collusion.

34.

B

Demand is inelastic, so airlines charge prices and get it paid by the flyers.

40.

A

Economic profit calculation, considers explicit as well as implicit cost.