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Liberty University ECON 213 Quiz 11 Complete Solutions Correct Answers Key

A fully answered Quiz 11 for ECON 213, covering important economic topics.

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    Liberty University ECON 213 quiz 1 1 complete solutions correct answers key Two different versions Version A Quiz Question 1 Why would perfectly competitive industries advertise even though individual firms do not? Question 2 We could state correctly that the minimum characteristic necessary to distinguish among price making firms is: Question 3 Which of the following is true in long run equilibrium for both a competitive market and monopolistic competition? Question 4 In the long run, monopolistically competitive firms like Hardee’s and Carl’s Jr. operate at a price that: Question 5 Which of the following is the best example of a firm operating in a monopolistically competitive market? Question 6 Markup would generally be highest under: Question 7 In the long run, the positive economic profits of Wings and Things, a monopolistic competitor, are: Question 8 A franchise might be worth $1 million or more because: Question 9 The fast food, bottled water, and cereal markets are all examples of: Question 10 An increase in marginal cost causes a profit maximizing, monopolistically competitive firm to: Question 11 Refer to the accompanying graph. To maximize profit, the monopolistically competitive firm shown will charge a price per unit of: Question 12 Sart Bimpson, an economics student, believes that a beer sold by one particular shack on the beach is completely different from an identical beer produced by the same factory and sold by the luxury hotel adjacent to the shack. The response that would best describe Sart’s belief is: Question 13 Which of the following is evidence of market power?

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    Question 14 Both perfectly competitive and monopolistically competitive industries have many firms, in fact so many that, in the long run: Question 15 If the marginal revenue curve lies above the demand curve for a firm: Question 16 Which of the following is always associated with monopolistic competition? Question 17 You shop at the local drugstore because it is convenient. This situation is best described as: Question 18 A generic product would be best described as one that is: Question 19 Which of the following statements best describes firms under monopolistic competition? Question 20 The short run equilibrium for a monopolistically competitive firm is at price = $29, average total cost = $22, and marginal cost = marginal revenue = $18. Which of the following is true? Version B Quiz Question 1 A monopolistically competitive firm usually charges more than a perfectly competitive firm because: Question 2 If barriers to entry are high and products are somewhat differentiated: Question 3 Excess capacity best describes the fact that: Question 4 Monopolistically competitive firms: Question 5 Which of the following market structures describes an industry in which all firms produce differentiated output and there are few barriers to entry? Question 6 Refer to the accompanying graph. The maximum long run economic profit earned by this monopolistically competitive firm is: Question 7 If positive economic profit exists in monopolistic competition, there is: Question 8 The theory of monopolistic competition predicts that, in long run equilibrium, a monopolistically competitive firm will:

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