Siteadmin, Bureaucrats, Check users, nsAm_Govt_101RO, nsAm_Govt_101RW, nsAm_Govt_101_ta, nsJudgesRO, nsJudgesRW, nsJudges_talkRO, nsJudges_talkRW, nsTeam2RO, nsTeam2RW, nsTeam2_talkRO, nsTeam2_talkRW, oversight, Administrators
125,789
edits
Changes
Jump to navigation
Jump to search
Line 57:
Line 57: + + + +
Economics Model Answers Thirteen (view source)
Revision as of 17:49, May 20, 2007
, 17:49, May 20, 2007→Honors:
10. Look at Figure C (right). Assuming it represents the long run, describe what type of industry this is (e.g., monopoly, oligopoly, monopolistic competition, or perfect competition). Explain your answer.
10. Look at Figure C (right). Assuming it represents the long run, describe what type of industry this is (e.g., monopoly, oligopoly, monopolistic competition, or perfect competition). Explain your answer.
'''That looks like a monopoly because there is no supply curve, and the marginal revenue curve has twice the slope of the demand curve (i.e., the marginal revenue curve intersects the x-axis at one-half the quantity of the demand curve).'''
11. Economics is sometimes called the “dismal science” because economists predicted population to grow faster than the food supply, marginal returns to diminish, and profits to vanish. But, in fact, there is an abundance of food and profits have not vanished. Why is economics not so dismal after all?
11. Economics is sometimes called the “dismal science” because economists predicted population to grow faster than the food supply, marginal returns to diminish, and profits to vanish. But, in fact, there is an abundance of food and profits have not vanished. Why is economics not so dismal after all?
'''Perhaps because mankind has increasing economies of scale: as population increases, output increases by a greater percentage due to inventions and improvements in production.'''
12. Look again at Figure C (attached). This question has three parts. (I) At what point is there an allocatively efficient quantity? (II) At what point is revenue maximized? (III) At what point is profit maximized? Explain your answers.
12. Look again at Figure C (attached). This question has three parts. (I) At what point is there an allocatively efficient quantity? (II) At what point is revenue maximized? (III) At what point is profit maximized? Explain your answers.