10. When consumption of a good increases, marginal utility will
(A) increase.
(B) decrease.
(C)remain unchanged.
(D) approach total utility.

11. Marginal revenue for a single-price monopolist is(A) less than price. (B) equal to price.(C)greater than price. (D) equal to zero for all levels of output.

12. If a tax is imposed on buyers in a market in which supply is perfectly inelastic, the(A) buyers pay the entire tax.(B) sellers pay the entire tax.(C)buyers and the sellers both pay a portion of the tax.(D) neither the buyers nor the sellers pay the tax.

13. An indifference diagram has movies on the vertical axis and sodas on the horizontal axis. As the consumption of sodas increases, the marginal rate of substitution ________ and the indifference curve becomes ________.(A) falls; flatter (B) falls; steeper (C)rises; flatter (D) rises; steeper

14. The short-run supply curve for a perfectly competitive firm is its(A) marginal cost curve above the horizontal axis.(B) marginal cost curve above its shutdown point.(C)average cost curve above the horizontal axis.(D) average cost curve above its shutdown point.

15. Which market type has characteristics as follows: large number of firms, differentiatedproduct?(A) perfect competition (B) monopoly(C)oligopoly (D) monopolistic competition

16. The above (incomplete) table provides information about the relationships between labor and various product measures. The amount of labor that maximizes the marginal product of labor is(A) 2 units of labor. (B) 3 units of labor. (C)4 units of labor. (D) 5 units of labor.

17. In perfect competition, at al levels of output the market price is the same as the firms ________.(A) marginal revenue (B) normal profit(C)average variable cost (D) fixed cost

18. Suppose some firms in a perfectly competitive industry are incurring an economic loss. As a result,(A) all the firms will eventually incur an economic loss.(B) some firms will leave the industry and the remaining firms quantity will decrease. (C)some firms will leave the industry and the price of the good will rise.(D) the total industry economic profit must equal $0.

19. Which of the following statements is FALSE?(A) In the short run, a monopolist might operate even though it is incurring an economic loss but in the short run a perfectly competitive firm always shuts down if it is incurring an economic loss.(B) A monopoly can earn an economic profit in the long run but a perfectly competitive firm cannot.(C)A monopoly can set its price while a perfectly competitive firm cannot.(D) A monopoly is protected by barriers to entry while a perfectly competitive firm is not.

20. In the long-run, a single-price monopolist will(A) not be able to continue to earn economic profits and will earn a normal profit.(B) be able to continue to earn economic profits as long as the market remains a monopoly.(C)end up being regulated by the government because it is making short-run economicprofits.

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