economics question?? need help please!!!

Posted on 2014-11-19 08:18:00 in Economics by MARTEEN

Use the following to answer questions 1-6:

1. In the figure above, at a price of $1, the firm would earn an economic profit of

A) $12.50.

B) $9.

C) $13.50.

D) 0.

2. According to the figure above, if the market price was $1.50, the individual firm would

A) be earning a positive economic profit of about $0.87

B) be earning a positive economic profit of about $5.

C) be earning a negative economic profit of about $4.50.

D) be earning a negative economic profit of about $5.

E) be earning a positive economic profit of about $0.50.

3. Refer to the figure above.  Assume that first there is an increase in demand in the market from D1 to D2.  According to the competitive model discussed in class, in the long run, the typical competitive firm

A) will produce at quantity 9 and price $1.

B) will produce at quantity 10 and price $1.50.

C) will produce at quantity 9 and price $1.50.

D) will produce at quantity 9 and price $1.25.

E) will shut down.

4. According to the figure above, the shift of the MR curve in the graph on the right side from MR1 to MR2 is the result of

A) an increase in demand.

B) a decrease in demand.

C) more firms in the industry.

D) fewer firms in the industry.

E) each existing firm becoming  more efficient.

5. According to the competitive model, the shift of the S curves in the graph on the left side from S1 to S2 to S3 represents

A) an increased supply because more firms enter the industry.

B) an increased supply resulting from a larger number of customers.

C) an increased supply because each firm produces more.

D) an increased quantity supplied resulting from a higher demand.

E) an increased quantity supplied resulting from a higher price.

6. According to the figure above, the long-run equilibrium point is not

A) at the point where ATC = MC.

B) at a quantity of 10.

C) at the minimum point of the ATC curve.

D) at a quantity of 9.

E) at the point where ATC = MR.

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