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;;1.;(Consider This) An unprofitable motel will stay open in the short-run if;A.;price (average nightly room rate) exceeds average variable cost.;B.;marginal revenue exceeds marginal cost.;C.;price (average nightly room rate) exceeds average fixed cost.;D.;marginal revenue exceeds price.;2.;A purely competitive seller's average revenue curve coincides with;A.;its marginal revenue curve only.;B.;its demand curve only.;C.;both its demand and marginal revenue curves.;D.;neither its demand nor its marginal revenue curve.;3.;The short-run shut-down point for a purely competitive firm occurs;A.;at any point where price is less than the minimum AVC.;B.;between the two break-even points.;C.;at any point where total revenue is less than total cost.;D.;at any point where the firm is not making an economic profit.;4.;The following table applies to a purely competitive industry composed of 100 identical firms.;R-1 REF23131;Refer to the above table. If each of the 100 firms in the industry is maximizing its profit and earning only a normal profit, each must have an average total cost of;A.;$2.;B.;$3.;C.;$4.;D.;$5.;5.;R-2 F23105;Refer to the above diagram. At P 4, this firm will;A.;shut down in the short run.;B.;produce 30 units and incur a loss.;C.;produce 30 units and earn only a normal profit.;D.;produce 10 units and earn only a normal profit.;6.;The demand schedule or curve confronted by the individual purely competitive firm is;A.;relatively elastic, that is, the elasticity coefficient is greater than unity.;B.;perfectly elastic.;C.;relatively inelastic, that is, the elasticity coefficient is less than unity.;D.;perfectly inelastic.;7.;R-3 F23038;Refer to the above short-run data. The shape of the total cost curve reflects;A.;diminishing opportunity costs.;B.;the law of rising fixed costs.;C.;increasing and diminishing returns.;D.;econo


Paper#80756 | Written in 18-Jul-2015

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