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tionna98 tionna98
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Posts: 341
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6 years ago
Suppose a perfectly competitive constant-cost industry is in long-run equilibrium when market demand suddenly increases. What would probably happen to a firm in this industry in the long run?
 a. It would experience no change for the original equilibrium
  b. It would experience a higher equilibrium price
  c. It would experience a lower equilibrium price
  d. It would experience the same equilibrium price but would reduce its output
  e. It would experience higher average total costs and would reduce its output

QUESTION 2

For which of the following products would price discrimination be easiest?
 a. orange juice
  b. diamonds
  c. compact disks
  d. haircuts
  e. gasoline

QUESTION 3

According to the U.S. Supreme Court's 1920 ruling on U.S. Steel,
 a. all monopolies are illegal
  b. all oligopolies violate the Sherman Antitrust Act
  c. large firms cannot be found to be in violation of the Sherman Antitrust Act
  d. mere size is no offense
  e. possession of market power is sufficient for a firm to be found in violation of the Sherman Antitrust Act

QUESTION 4

Suppose that a long-run adjustment in a perfectly competitive industry results in decreased industry output but leaves price unchanged. Which of the following must be true?
 a. The market demand curve did not shift
  b. The market demand curve shifted left; the market supply curve shifted right
  c. The market supply curve shifted left; the market demand curve shifted right
  d. Both market supply and demand increased, but supply increased more than demand
  e. The industry is a constant-cost industry

QUESTION 5

A major fruit juice manufacturer failed in its attempt to engage in price discrimination between students and all other consumers. What is a possible explanation for this failure?
 a. There was nothing to prevent the students from reselling the fruit juice to other consumers.
  b. The fruit juice manufacturer produced in a perfectly competitive market.
  c. The two groups of consumers probably have the same demand elasticity for fruit juice.
  d. The cost of producing the product is relatively high.
  e. Demand for fruit juice is probably inelastic.

QUESTION 6

Under the rule of reason, a U.S. firm with an 80 percent market share
 a. will always be found in violation of the Sherman Antitrust Act
  b. will never be found in violation of the Sherman Antitrust Act
  c. may be found in violation of the Sherman Antitrust Act, depending on the firm's conduct
  d. will always be found in violation of the Sherman Antitrust Act if there is only one other firm in the industry
  e. will be found in violation of the Sherman Antitrust Act only if there is only one other firm in the industry

QUESTION 7

If an industry is a constant-cost industry
 a. prices of its inputs increase even though output remains constant
  b. it uses inputs at higher levels of output
  c. prices of its inputs rise at a constant rate as it uses more inputs
  d. prices of its inputs remain constant as the number of firms increases
  e. firms in the industry experience economies of scale
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Replies
wrote...
6 years ago
[Answer to ques. #1]  A

[Answer to ques. #2]  D

[Answer to ques. #3]  D

[Answer to ques. #4]  E

[Answer to ques. #5]  A

[Answer to ques. #6]  C

[Answer to ques. #7]  D
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