A professional tennis player enters fewer tournaments each year as the prize money she won increased. This observation indicates that the tennis player
A) is irrational.
B) has shifted her labor demand curve leftward.
C) has shifted her labor supply curve rightward.
D) has a backward bending labor supply curve.
Ques. 2The above (incomplete) table provides information about the relationships between output and various cost measures. The total fixed cost (TFC) for the firm is
A) zero.
B) 45.
C) 10.
D) None of the above answers is correct.
Ques. 3The table above shows sales of the firms in the pet food industry. The Herfindahl-Hirschman Index in the industry is
A) 1260.
B) 1443.
C) 1100.
D) 1588.
Ques. 4Suppose the government has declared beer to be an illegal substance and imposes a fine on any person caught selling a beer. Buying beer, however, remains legal.
Using the above figure, in which CBL is the cost of breaking the law, what is the equilibrium price and quantity with this new law in effect? A) 5 per quart and 300 quarts of beer
B) 3 per quart and 500 quarts of beer
C) 3 per quart and 100 quarts of beer
D) 1 per quart and 300 quarts of beer
Ques. 5The above figures show the market for oranges. Which figure shows the effect of changing consumer preferences for more orange juice and less coffee in the morning?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
Ques. 6If the price of milk increased by 5 percent because of an increase in the demand for milk, and the quantity of milk supplied increased by 7 percent
A) the supply curve of milk has shifted rightward.
B) the price elasticity of supply of milk is greater than one.
C) milk is more of a luxury than a necessity.
D) milk is more of a necessity than a luxury.
Ques. 7Suppose that the marginal social benefit from another unit of a public good is less than the marginal social cost of producing it. Then
A) the principle of minimum differentiation means that production should be decreased.
B) the number of free riders is at its efficient amount.
C) less of the product should be produced because its provision exceeds the efficient level.
D) more of the product should be produced because its provision is less than the efficient level.
Ques. 8In the above figure, at a price of 6, a perfectly competitive firm produces ________ and it ________.
A) some output; incurs an economic loss
B) 0; incurs an economic loss
C) 0; does not incur an economic loss or make an economic profit
D) 0; makes an economic profit
Ques. 9If firms in a monopolistically competitive industry are making an economic profit, then definitely there is
A) a leftward shift in each firm's demand curve as new firms enter the market.
B) a rightward shift in each firm's marginal revenue curve as new firms enter the market.
C) an upward shift in each firm's cost curves as new firms enter the market.
D) All of the above answers are correct.
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