Instructions: This quiz should only take you about an hour. Turn your answers in
ID: 1122242 • Letter: I
Question
Instructions: This quiz should only take you about an hour. Turn your answers in to your TA either during recitation, office hours, or lecture next week. You do not have to wait until the due date to turn in your answers. There will be boxes on the table at the front of the lecture hall for you to drop your completed quiz into, not later than Eriday, December 8. Late work will not be accepted. 1. S uppose a local hardware store has explicit costs of $1 million per year and implicit costs of $45,000 per year. If the store earned an economic profit of $35,000 last year, this means that the store's accounting profit equaled: A) $94,000 8) $80,000 C) $1.08 million D) $1 million A 2. For the Colorado beef industry to be classified as perfectly competitive, ranchers in o must have on prices and beef must be aproduct. A)no noticeable effect; standardized B) a huge effect; standardized C) a huge effect; differentiated D) no noticeable effect; differentiated 3. For the fast food restaurant industry to engage in monopolistic competition, there must be restaurants) and the restaurant offerings must be A) few; standardized B) many; standardized C) one; differentiated D) many; differentiated 4. Economics deals primarily with the concept of A) money B) banking D) consumption Callie makes 20 wedding cakes per day. The marginal cost of the 20th cake is $24, and the average total cost of 20 cakes is $5. The average total cost of the 19 cakes is: A) $6 B) $5 C) $4 D) $8 5.Explanation / Answer
Ans)
3.
D) many; differentiated
In a monopolistic competition market, there must be many firms who offer differentiated products.
5.
C) $4
n=20 cakes
MC(20)=24
ATC=5
TC(20 units)=20*5=100
TC(19 units)=100-24=76
ATC=76/19=4