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ECON 201 Exam 2 exam with complete solutions 2024_2025
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ECON 201 Exam 2 exam with complete solutions 2024_2025
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ECON 201 Exam 2 exam with completesolutions 2024/2025
In economics, a firm that faces no competitors is referred to as
_________________.
A. an oligopoly
B. a monopoly
C. a perfect competitor
D. an oligopolizor - ANSWER-B. a monopoly
________________________ arises where many firms are competing in a market
to sell
similar but differentiated products.
A. Oligopolistic competition
B. Perfect competition
C. Monopolistic competition
D. Monogopolised competition - ANSWER-C. Monopolistic competition
A firm's ___________ consist of expenditures that must be made before
production starts that
typically, over the short run, _______________ regardless of the level of
production.
A. fixed costs; do not change,
B. variable costs; are constantly changing,
C. fixed costs; are consistently changing,
D. variable costs; do not change, - ANSWER-A. fixed costs; do not change,
,______________ include all of the costs of production that increase with the
quantity
produced.
A. Fixed costs
B. Variable costs
C. Average costs
D. Average variable costs - ANSWER-B. Variable costs
____________________________ occur when the marginal gain in output
diminishes as each
additional unit of input is added.
A. Diminishing variable returns
B. Diminishing average returns
C. Diminishing marginal returns
D. Diminishing marginal costs - ANSWER-C. Diminishing marginal returns
In order to determine ____________, the firm's total costs must be divided by the
quantity of
its output.
A. diminishing marginal returns
B. fixed costs
C. variable cost
D. average cost - ANSWER-D. average cost
In order to determine the average variable cost, the firm's variable costs are
divided by
_______________________.
A. its' fixed costs
B. the quantity of output
C. its' average costs
D. diminishing marginal costs - ANSWER-B. the quantity of output
The term _____________ is used to describe the additional cost of producing one
more unit.
A. average cost
B. fixed cost
C. variable cost
, D. marginal cost - ANSWER-D. marginal cost
The term __________________ describes a situation where the quantity of output
rises, but
the average cost of production falls.
A. diminishing marginal returns
B. marginal cost output
C. economies of scale
D. diseconomies of scale - ANSWER-C. economies of scale
The term "constant returns to scale" describes a situation where
A. expanding all inputs does not change the average cost of production.
B. a larger-scale firm can produce at a lower cost than a smaller-scale firm.
C. expanding all inputs changes the average cost of production.
D. the quantity of output rises and the average cost of production falls. -
ANSWER-A. expanding all inputs does not change the average cost of
production.
If a firm is experiencing _____________________, then as the quantity of output
rises, the
average cost of production rises.
A. decreasing returns to scale
B. consent returns to scale
C. economies of scale
D. increasing returns to scale - ANSWER-A. decreasing returns to scale
_____________ is calculated by taking the quantity of everything that is sold and
multiplying it by the sale price.
A. Total revenue
B. Total profits
C. Average profit margin
D. Total cost - ANSWER-A. Total revenue
Marcella operates a small, but very successful art gallery. All but one of the
following can be
classified as a variable cost arising from the physical inputs Marcella requires to
operate her
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