ECON 1113 EXAM 3 QUESTIONS WITH
CORRECT ANSWERS
What is the equation for total revenue? - CORRECT ANSWER✔✔-Price x
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Quantity
What is the equation for marginal revenue? - CORRECT ANSWER✔✔-
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Change in Total Revenue/change in Quantity
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What is the equation for marginal cost? - CORRECT ANSWER✔✔-
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Change in Total Cost/Change in Quantity
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What is the equation for total cost? - CORRECT ANSWER✔✔-Total Fixed
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Costs + Total Variable Costs
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What is the equation for total profit? - CORRECT ANSWER✔✔-Total
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Revenue - Total Costs
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What is the equation for marginal profit? - CORRECT ANSWER✔✔-
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Marginal Revenue - Total Costs
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, What is the primary goal of every business? - CORRECT ANSWER✔✔-To
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maximize profit |
What is the first step every business should take in order to reach their
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primary goal? - CORRECT ANSWER✔✔-How much they should produce
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(Quantity)
What is the general formula that businesses use when deciding how to
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execute this first step? Why do they use this formula? - CORRECT
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ANSWER✔✔-Marginal Revenue = Marginal Cost or Marginal Revenue is | | | | | | | | |
greater than or equal to Marginal Cost. They use this to determine if
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they are generating a profit.
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How do perfectly competitive firms determine the price they should
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charge? Do they have any control over this price? - CORRECT
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ANSWER✔✔-Perfectly competitive firms look to the market to | | | | | | | |
determine the price they should charge. They have no control over the
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price.
In a perfectly competitive market _____=_____=_____ - CORRECT
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ANSWER✔✔-P=D=MR
If the market price for a perfectly competitive good is $15 and suppliers
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decrease production from 10,000 to 8,000 units, what will happen to
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CORRECT ANSWERS
What is the equation for total revenue? - CORRECT ANSWER✔✔-Price x
| | | | | | | | | | |
Quantity
What is the equation for marginal revenue? - CORRECT ANSWER✔✔-
| | | | | | | | |
Change in Total Revenue/change in Quantity
| | | | |
What is the equation for marginal cost? - CORRECT ANSWER✔✔-
| | | | | | | | |
Change in Total Cost/Change in Quantity
| | | | |
What is the equation for total cost? - CORRECT ANSWER✔✔-Total Fixed
| | | | | | | | | | |
Costs + Total Variable Costs
| | | |
What is the equation for total profit? - CORRECT ANSWER✔✔-Total
| | | | | | | | | |
Revenue - Total Costs
| | |
What is the equation for marginal profit? - CORRECT ANSWER✔✔-
| | | | | | | | |
Marginal Revenue - Total Costs
| | | |
, What is the primary goal of every business? - CORRECT ANSWER✔✔-To
| | | | | | | | | | |
maximize profit |
What is the first step every business should take in order to reach their
| | | | | | | | | | | | | |
primary goal? - CORRECT ANSWER✔✔-How much they should produce
| | | | | | | | |
(Quantity)
What is the general formula that businesses use when deciding how to
| | | | | | | | | | | |
execute this first step? Why do they use this formula? - CORRECT
| | | | | | | | | | | |
ANSWER✔✔-Marginal Revenue = Marginal Cost or Marginal Revenue is | | | | | | | | |
greater than or equal to Marginal Cost. They use this to determine if
| | | | | | | | | | | | |
they are generating a profit.
| | | |
How do perfectly competitive firms determine the price they should
| | | | | | | | | |
charge? Do they have any control over this price? - CORRECT
| | | | | | | | | | |
ANSWER✔✔-Perfectly competitive firms look to the market to | | | | | | | |
determine the price they should charge. They have no control over the
| | | | | | | | | | | |
price.
In a perfectly competitive market _____=_____=_____ - CORRECT
| | | | | | | |
ANSWER✔✔-P=D=MR
If the market price for a perfectly competitive good is $15 and suppliers
| | | | | | | | | | | | |
decrease production from 10,000 to 8,000 units, what will happen to
| | | | | | | | | | |
