Tag: revenue and revenue curves

Questions Related to revenue and revenue curves

The concept of marginal cost is closely related with which of the following?

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. Variable cost

  2. Fixed cost

  3. Opportunity cost

  4. Economic cost

Show answer
Correct Option: A

In a non-competitive market, when the demand of the product increases and the product price increases _______________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. the marginal revenue curve will shift to the right

  2. the marginal revenue curve will shift to the left

  3. the firm will move up the marginal revenue curve and hire fewer units of the input

  4. the firm will move down the marginal revenuencurve and hire fewer units of the input

Show answer
Correct Option: A
Explanation:

The marginal revenues curve follows from the demand curve/average revenue curve (it is twice as steep as the demand curve), thus if the demand curve shifts upwards the marginal revenue curve will also shift upwards. 

The supply curve for the monopolist __________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. does not exist

  2. is represented by the marginal cost curve above the average total cost curve

  3. is represented by the marginal cost curve above the average variable cost curve

  4. none of the above

Show answer
Correct Option: A

Marginal revenue for a monopolist is equal to ________________________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. the increased revenue from the sale of an additional unit less the loss the revenue from selling previous unit at a lower price

  2. the change in revenue resulting from a one unit change in output

  3. the change in revenue divided by the change in output

  4. all of the above

Show answer
Correct Option: D

In imperfect competition, the average revenue and marginal revenue curves are ________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. different

  2. same

  3. identical

  4. perpendicular

Show answer
Correct Option: A

Which of the following is true regarding monopolistic competition?

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. $AR=MR$

  2. $MR=0$

  3. $AR< MR$

  4. $AR>MR$

Show answer
Correct Option: D

When AR is falling, MR will be ___________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. equal to AR

  2. less than AR

  3. more than AR

  4. either more or equal to AR

Show answer
Correct Option: B

Under monopoly, MR can be negative only when:

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. AR is increasing

  2. AR is decreasing

  3. AR is constant

  4. AR is zero

Show answer
Correct Option: B

The strength of a monopolist may be assessed by ____________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. the size of his total revenue

  2. the gap between AR and MR

  3. the size of consumer's surplus accruing to him

  4. the long-term price of his product

Show answer
Correct Option: B

If AR curve is falling straight line, MR curve will lie below it in such a way that any line drawn from a point from y-axis parallel to x-axis to meet the AR curve is intersected by the MR curve _________.

economics theories of distribution liquidity preference and profit revenue and revenue curves simple monopoly and commodity market

  1. mid-way

  2. more than half-way

  3. less than half-way

  4. any where

Show answer
Correct Option: A