1 A) negative B) positive C) zero D) zero if it is a constant cost industry, positive otherwise 2 A) Consumer surplus is minimized B) Producer surplus exceeds consumer surplus C) Combined consumer and producer surplus is maximized D) The difference between producer surplus and consumer surplus is maximized 3 A) in a decreasing cost industry B) if resource prices rise at the same rate as industry demand rises C) if resource prices fall at the same rate as industry demand rises D) if resource prices remain constant as industry demand rises or falls 4 A) producing every unit of wheat whose marginal benefit equals or exceeds its marginal cost B) that each wheat farm produces its output at minimum average variable cost C) zero economic profits for all wheat farmers D) maximizing consumer surplus while minimizing producer surplus 5 A) the exit of firms following a long term reduction in demand B) the process by which old industries or technologies are replaced by newer ones C) the unwillingness of competitive firms to adopt new technologies because competition precludes their ability to earn long-run economic profits D) the process by which competitive industries become monopolies in the long run 6 A) a higher price and a higher total output B) a lower price and a lower total output C) a higher price and a lower total output D) a lower price and a higher total output 7 A) at the quantity corresponding to the intersection of the market supply and demand curves B) if the market price exceeds minimum average total cost C) at any output level at least as large as the market equilibrium quantity D) provided price exceeds marginal cost 8 A) an upsloping long-run supply curve B) an upsloping long-run demand curve C) a perfectly elastic long-run supply curve D) less than optimal long-run output 9 <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/0217511447/883736/ch09_q9.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (15.0K)</a>]]> A) new firms to enter, market demand to rise, and price to fall B) demand to increase, and price to rise C) input prices to fall, supply to increase, and price to fall D) some firms to exit, supply to decrease, and price to rise 10 A) allocative efficiency because P = min ATC but not productive efficiency because P > min AVC B) allocative efficiency because P = MC and productive efficiency because P = min ATC C) productive efficiency because P = min ATC but not allocative efficiency because P > MR D) neither productive nor allocative efficiency
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