Liberty University ECON 213 Quiz 9 Complete Solutions Correct Answers Key

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Liberty University ECON 213 quiz 9complete solutions correct answers keyTwo versionsQuestion 1 In the long run, if a firm is making a loss, it will:Question 2 Refer to the accompanying figure. This firm’s shortrun supply curve is represented bythe:Question 3 In competitive markets:Question4JimandLisaownadoggroomingbusinessinChamplain,NewYork,calledJLGroomers.Therearemanybuyersandmanysellersinthedoggroomingservicemarket.JLGroomers experiences normal cost curves, with the marginal cost (MC) curve crossing averagevariable cost (AVC) at $14 and average total cost (ATC) at $22. JL Groomers will always shut downif the market price is:Question 5 Dave’s Batting Cages is located in Boston, Massachusetts. During the first year ofoperation, Dave’s Batting Cages incurred many costs. In that year, Dave spent $5,000 on labor,$2,000 on maintenance, and $1,000 on electricity. Dave took out a loan to open his business, inwhich he would have earned $1,500, and his previous job, which he could get back at any time,paid him $50,000. Dave’s Batting Cages incurred _________ in explicit costs.Question 6 Refer to the accompanying figure to answer the questions that follow. If the price is $3,the firm is making:Question 7 A firm’s willingness to supply its product in the long run is represented on a graph bythe:Question 8 The accompanying table represents the quantity produced, the total revenue, and thetotal cost of a firm operating in a perfectly competitive market. Refer to this table to answer thequestions that follow. Profits are maximized when producing:Question 9 Firms will be indifferent about shutting down or producing if the price they charge is:Question 10 The accompanying table represents the quantity produced, the total revenue, and thetotal cost of a firm operating in a perfectly competitive market. Refer to this table to answer thequestions that follow. When profits are maximized, profits are equal to:Question 11 If firms in a competitive market are making positive economic profits, you would

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expect firms to:Question 12 A firm will shut down in the longrun if the:Question 13 Which of the following lists the three main characteristics of a competitive market?Question 14 Refer to the accompanying figure. A firm would be suffering a loss but still beproducing if the price is:Question 15 Charlie’s Churros is a perfectly competitive firm that sells desserts in Houston, Texas.Charlie’s Churros currently is taking in $40,000 in revenues, and has $15,000 in explicit costs and$25,000 in implicit costs. Charlie’s Churros’ accounting profits are:Question 16 Tom’s Campgrounds is a firm conducting business in a competitive market. Tomrealizes he is making a loss and is trying to decide whether to shut down or stay open. He shouldstay open:Question 17 If Dirk’s Doughnuts is a perfectly competitive firm and is currently incurring economiclosses of $500:Question 18 One reason why the longrun supply curve may slope upward in a competitive marketis that:Question 19 If Nicole’s KnickKnacks is a perfectly competitive firm and is making zero economicprofits:Question 20 Refer to the accompanying set of graphs to answer the questions that follow. Whichgraph would result in firms exiting a perfectly competitive market in the long run?Version BQuestion 1 In a competitive market, if one firm raises its price relative to the other firms in themarket, consumers are willing to go to another firm because:Question 2 Refer to the accompanying table. A firm participating in a competitive market withthese costs would be indifferent about producing or shutting down if the price is:Question 3 Refer to the accompanying figure. Point _________ corresponds to the profitmaximizingquantity that a competitive firm would produce.

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Question4Refertotheaccompanyingfigure. Afirmwouldbesufferingalossbutstillbeproducing if the price is:Question 5 Refer to the accompanying table. A firm participating in a competitive market withthese costs would be making a profit if the price is:Question 6The city of Tustin, California, has spent $10 million ona project to build a newcommunity college. It will cost the city $40 million to finish the project. When making the decisionto continue the project, the city’s chief economist tells the city council to ignore the $10 millionbecause:Question 7 A firm’s willingness to supply its product in the short run is represented on a graph bythe:Question 8 A firm’s shortrun supply curve is equal to the firm’s:Question 9 Refer to the accompanying figure to answer the questions that follow. If the price is $3,the firm is making:Question10Whentalkingabouteconomicprofitsinaperfectlycompetitivemarket,thedifference between the long run and the short run is that, in the short run, firms:Question 11 Dave’s Batting Cages is located in Boston, Massachusetts. During the first year ofoperation, Dave’s Batting Cages incurred many costs. In that year, Dave spent $5,000 on labor,$2,000 on maintenance, and $1,000 on electricity. Dave took out a loan to open his business, inwhich he would have earned $1,500, and his previous job, which he could get back at any time,paid him $50,000. Dave’s Batting Cages incurred _________ in explicit costs.Question 12 Refer to the accompanying figure. A firm would be making positive profits if theprice is:Question 13 All firms, no matter what type of firm structure they are producing in, make theirproduction decisions based on the point where their:Question 14 A firm characterized as a pricetaker:Question 15 A good economist will ignore _________ and focus on _________ when it comes tomaking the right decisions.Question 16 The accompanying table represents the quantity produced, the total revenue, and the

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