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ECON 5313 – FINAL 2026
ACTUAL QUESTIONS WITH
VERIFIED ANSWERS.
What contributes to the existence of multiproduct firms? -
correct answer-Economies of scope and cost complementarity
A perfectly competitive firm faces a: - correct answer-perfectly
elastic demand function.
Suppose that initially the price is $50 in a perfectly competitive
market. Firms are making zero economic profits. Then the
market demand shrinks permanently, some firms leave the
industry, and the industry returns to a long-run equilibrium.
What will be the new equilibrium price, assuming cost
conditions in the industry remain constant? - correct answer-
$50
Which of the following market structures would you expect to
yield the greatest product variety? - correct answer-
Monopolistic competition
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Economies of scale exist whenever: - correct answer-average
total costs decline as output increases.
Which of the following is true under monopoly? - correct
answer-P>MC
Differentiated goods are a feature of a: - correct answer-
monopolistically competitive market.
Which of the following is true? - correct answer-In the short run,
a monopoly will shut down if P < AVC.
Which of the following is an example of monopoly? - correct
answer-Local utility industry in a small town
Which of the following features is common to both perfectly
competitive markets and monopolistically competitive markets?
- correct answer-There is free entry and long-run profits are
zero.
ECON 5313 – FINAL 2026
ACTUAL QUESTIONS WITH
VERIFIED ANSWERS.
What contributes to the existence of multiproduct firms? -
correct answer-Economies of scope and cost complementarity
A perfectly competitive firm faces a: - correct answer-perfectly
elastic demand function.
Suppose that initially the price is $50 in a perfectly competitive
market. Firms are making zero economic profits. Then the
market demand shrinks permanently, some firms leave the
industry, and the industry returns to a long-run equilibrium.
What will be the new equilibrium price, assuming cost
conditions in the industry remain constant? - correct answer-
$50
Which of the following market structures would you expect to
yield the greatest product variety? - correct answer-
Monopolistic competition
, Page | 2
Economies of scale exist whenever: - correct answer-average
total costs decline as output increases.
Which of the following is true under monopoly? - correct
answer-P>MC
Differentiated goods are a feature of a: - correct answer-
monopolistically competitive market.
Which of the following is true? - correct answer-In the short run,
a monopoly will shut down if P < AVC.
Which of the following is an example of monopoly? - correct
answer-Local utility industry in a small town
Which of the following features is common to both perfectly
competitive markets and monopolistically competitive markets?
- correct answer-There is free entry and long-run profits are
zero.
