MicroEconomics, Theory and Applications 1 MCQs

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Ram Sharma • 193.84K Points
Coach

Q 31. Suppose a firm sells its product at a price lower than the opportunity cost of the inputs used to produce it. Which is true?

(A) the firm will earn accounting and economic profits

(B) the firm will face accounting and economic losses

(C) the firm will face an accounting loss, but earn economic profits

(D) the firm may earn accounting profits, but will face economic losses

A

Admin • 34.80K Points
Instructor I

Q 32. If a firm’s revenues just cover all its opportunity costs, then:

(A) normal profit is zero

(B) economic profit is zero

(C) total revenues equal its explicit costs

(D) total revenues equal its implicit costs

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Rakesh Kumar • 26.25K Points
Instructor II

Q 33. Which would be an implicit cost for a firm? The cost:

(A) of worker wages and salaries for the firm

(B) paid for leasing a building for the firm

(C) paid for production supplies for the firm

(D) of wages foregone by the owner of the firm.

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Vijay Sangwan • 26.16K Points
Instructor II

Q 34. Implicit costs are:

(A) equal to total fixed costs

(B) comprised entirely of variable costs

(C) “payments” for self-employed resources

(D) always greater in the short run than in the long run

V

Vikash Gupta • 31.32K Points
Instructor I

Q 35. A firm that is threatened by the potential entry of competitors into a market builds excess production capacity. This is an example of

(A) a prisoners’ dilemma

(B) collusion

(C) a credible threat

(D) tit-for-tat

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Rakesh Kumar • 26.25K Points
Instructor II

Q 36. Sequential games can be solved using

(A) tit-for-tat

(B) dominated strategies

(C) backward induction

(D) risk averaging

A

Admin • 34.80K Points
Instructor I

Q 37. A game that involves multiple moves in a series of identical situations is called a

(A) sequential game

(B) repeated game

(C) zero-sum game

(D) nonzero-sum game

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Ranjeet • 32.29K Points
Instructor I

Q 38. A game that involves interrelated decisions that are made over time is a

(A) sequential game

(B) repeated game

(C) zero-sum game

(D) nonzero-sum game

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Rakesh Kumar • 26.25K Points
Instructor II

Q 39. A strategy that is best regardless of what rival players do is called

(A) first-mover advantage

(B) a nash equilibrium strategy

(C) tit-for-tat

(D) a dominant strategy

S

Shiva Ram • 28.35K Points
Instructor II

Q 40. In game theory, the outcome or consequence of a strategy is referred to as the

(A) payoff

(B) penalty

(C) reward

(D) end-game strategy