Category: Economics

In which way does monopolistic competition differ from perfect competition?

Select ONE answer:

1. Average revenue exceeds average cost in long-run equilibrium.
2. Barriers exist to the entry of new firms.
3. Marginal revenue exceeds marginal cost in long-run equilibrium.
4. Products are differentiated.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

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To maximise total revenue, up to which point should a monopolist increase output?

Select ONE answer:

1. where marginal revenue equals average revenue
2. where marginal revenue is maximised
3. where marginal revenue is zero
4. where price elasticity of demand is zero

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

What is marginal cost?

Select ONE answer:

1. the difference between the total cost of producing n and n-1 units of output
2. the difference between the average variable cost of producing n units and n-1 units of output
3. the difference between the average total cost of producing n units and n-1 units of output
4. the average variable cost of producing one more unit

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 1

1. Correct
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A firm’s long-run production function describes the relationship between….?

Select ONE answer:

1. the firm’s output and the quantities of factor inputs employed.
2. the firm’s long-run average cost of production and the level of output.
3. the firm’s long-run average cost of production and the quantities of factor inputs employed.
4. the prices of factor inputs and the quantities of factor inputs employed.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 1

1. Correct
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A worker responds to an increase in his hourly wage rate by reducing the number of hours he works per week.

What would explain this?

Select ONE answer:

1. The income effect of the wage rate increase outweighs the substitution effect.
2. The opportunity cost of leisure has increased.
3. The worker prefers leisure to work.
4. The worker’s supply of labour is wage inelastic.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 1

1. Correct
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.