There are six firms in an industry, with market shares of 50 percent, 25 percent, 10 percent, 10 percent, 3 percent and 2 percent. The four firm concentration ratio is ________, and the HHI is ________.
A) 100; 100
B) 95; 3338
C) 95; 10,000
D) 100; 3338
Ques. 2In the short run, an increase in demand for a good that is sold in a perfectly competitive market
A) increases the number of firms in the market.
B) increases the economic profits of existing firms in the market.
C) has no effect on the price.
D) causes more firms to shut down.
Ques. 3The curve in the above figure shows alternative combinations of gasoline and coffee that Sam likes equally well. This curve is called
A) a budget line.
B) a demand curve.
C) a consumption curve.
D) an indifference curve.
Ques. 4In one day, Brandon can either plow 10 acres or plant 20 acres. In one day, Christopher can either plow 14 acres or plant 14 acres. Brandon and Christopher can
A) gain from exchange if Brandon specializes in planting and Christopher specializes in plowing.
B) gain from exchange if Brandon specializes in plowing and Christopher specializes in planting.
C) exchange, but only Brandon will gain from the exchange.
D) exchange, but only Christopher will gain from the exchange.
Ques. 5The table gives some data on the supply of roses in a small town. When the price rises from 15 a dozen to 25 a dozen, the elasticity of supply is ________.
A) 1.25
B) 5.00
C) 0.20
D) 0.80
Ques. 6The above figure shows the market for hamburger. Which panel shows the effect of a new excise tax on all beef products?
A) Figure A
B) Figure B
C) Figure C
D) Figure D
Ques. 7In the figure above, if no one owns the lake, at the equilibrium quantity what is the marginal social cost of producing the pesticide?
A) 80
B) 40
C) 60
D) 30
Ques. 8If Pearl is a risk averse, then
A) expected utility has nothing to do with her choices.
B) she does not have diminishing marginal utility of wealth.
C) she will not buy insurance.
D) risk is costly to her.
Ques. 9Compared to a single-price monopoly, a perfectly competitive market with the same costs produces ________ output and has a ________ price.
A) less; lower
B) less; higher
C) more; lower
D) more; higher
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