In the long run, marginal cost must equal marginal revenue for a monopolistic competitive firm, but ...

In the long run, marginal cost must equal marginal revenue for a monopolistic competitive firm, but not at the minimum point of the long-run average cost curve.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 2

If fixed cost is 200,000 and variable cost is 30 per unit over the relevant range of output, when 10,000 units are produced, the average total cost will be:
 a. 20.
  b. 30.
  c. 50.
  d. 70.

QUESTION 3

The Keynesian approach to government economic policy:
 a. has emphasized the role of individual self-interest as a powerful stabilizing force.
  b. has consistently failed to reduce fluctuations in economic activity.
 c. was ineffective during the 1960s.
 d. highlighted the role of aggregate demand.
 e. was rechristened supply-side economics around 1980.

QUESTION 4

In a monopolistic competitive industry, short-run economic profit encourages entry of new firms until there are no economic profits in the long-run.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 5

When costs that vary with the level of output are divided by the output, you have calculated:
 a. total changing cost.
  b. total fixed cost.
  c. average fixed cost.
  d. average variable cost.