Question 1 of 20

The representative firm in a purely competitive industry:

A. Will always earn a profit in the short run

B. May earn either an economic profit or a loss in the long run

C. Will always earn an economic profit in the long run

D. Will earn an economic profit of zero in the long run

Question 2 of 20

An example of a monopolistically competitive industry would be:

A. Steel

B. Soybeans

C. Electricity

D. Retail clothing

Question 3 of 20

Firms in an industry will not earn long-run economic profits if:

A. Fixed costs are zero

B. The number of firms in the industry is fixed

C. There is free entry and exit of firms in the industry

D. Production costs for a given level of output are minimized

Question 4 of 20

Marginal product is:

A. the increase in total output attributable to the employment of one more worker.

B. the increase in total revenue attributable to the employment of one more worker.

C. the increase in total cost attributable to the employment of one more worker.