stud
bud
Sign up
Log in
Home
Library
Explore
SAT
More
ECO 251 Section Quiz Review Flashcards | StudBud
Explore
/
ECO 251 Section Quiz Review
ECO 251 Section Quiz Review
12 terms
·
StudBud Administration
·
13 plays
Chapters 7, 10, 13, and 14
Flashcards
12 cards
F
Practice quiz
P
Host live
L
Questions
12
Answers
1
If there is an increase in market demand in a perfectly competitive market then, in the short run:
New firms will enter the market so that each firm makes zero profit.
Each firm will increase its quantity produced and make a profit.
Each individual firm will not be affected.
Firms will exit the industry and drive prices up.
2
If the market price is $10, the firm will earn:
Negative economic profit in the short run and shut down.
Negative economic profit in the short run and continue to operate.
Positive economic profits in the short run.
Zero economic profits in the short run.
3
If the price is $1150, who would be willing to supply the product?
Abby, Bobby, and Diane
Abby and Bobby
Dianne and Evaline
Carlos, Diane, and Evaline
4
What is the value of the per unit externality depicted below in the graph of the tobacco market?
$1.30
$1.50
$2.80
$2.07
5
Marcus sells 300 candy bars at $0.50 each. His total costs are $125. What is his profit?
$150
$125
$124.50
$25
6
The surgeon general announces that chocolate causes tooth decay. As a result:
Price of chocolate decreases and producer surplus increases.
Price of chocolate increases and producer surplus increases.
Price of chocolate decreases and producer surplus decreases.
Price of chocolate increases and producer surplus decreases.
7
A perfectly competitive firm will earn zero economic profit in the long run.
False
True
8
What is the socially optimal quantity in this market?
3
6
4
5
9
Which of the following curves is likely average fixed cost?
B
A
C
D
10
Which area represents producer surplus at P2?
C
A+B+C+G
A+B+C
A+B
11
Which of the following is an example of an implicit cost?
Interest paid on firm debt.
The owner of a firm giving up an opportunity to work at a Wall Street firm.
Wages paid to workers.
Rent for office space.
12
According to the Coase Theorem, individuals can always work out a mutually beneficial agreement to solve externalities.
True
False
