Total utility is measured by a mythical unit called the:
a. bliss unit.
b. useful unit.
c. pleasure unit.
d. util.
QUESTION 2The short-run supply curve and short-run marginal cost curve for a perfectly competitive firm coincide when the market price is greater than average variable cost.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 3The conceptual measure of the satisfaction a person obtains by consuming all the units of a good or service during a given time period is:
a. total product.
b. total revenue.
c. total utility.
d. total product.
QUESTION 4A perfectly competitive firm will shut down in the short run when marginal revenue equals marginal cost at a price less than minimum average variable cost.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 5Consumers tend to maximize:
a. marginal utility.
b. marginal utility per dollar.
c. total utility.
d. money holdings.
e. consumer surplus.
QUESTION 6If marginal revenue exceeds marginal cost in the short run, total revenue for the perfectly competitive firm is greater than total cost.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 7Which of the following statements is true about the total utility provided by a good?
a. Total utility can never be negative.
b. Total utility is maximized when marginal utility is maximized.
c. Total utility continues to increase as more of the good is consumed.
d. Total utility is maximized when marginal utility is zero (for total utility > 0).
e. Total utility is maximized when marginal utility is zero (for total utility < 0).
QUESTION 8If marginal revenue equals marginal cost in the short run, the perfectly competitive firm earns zero profits.
a. True
b. False
Indicate whether the statement is true or false
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