Question

A firm produces 200 units of output at a total cost of $1,000. The firm's total fixed cost equals $200.The firm’s per-unit average variable cost is _____.

	a.	​$4
	b.	​$8
	c.	$5
	d.	​$10
	e.	​$7

A game that demonstrates the basic problem confronting noncolluding oligopolists is known as _____.

	a.	​a tit-for-strategy game
	b.	​the prisoners’ dilemma
	c.	​a cooperative game
	d.	​a noncooperative game
	e.	​the oligopolists’ dilemma

A linear demand curve for a good is:

	a.	​always equal to one.
	b.	​more price inelastic at higher price ranges.
	c.	​always equal to zero.
	d.	​more price elastic at higher price ranges.
	e.	​more price elastic at lower price ranges.

Answer 1

Ans.1- (A)

Total cost = 1000

TFC = 200

So, total variable cost= 1000-200 = 800

So, average variable cost = 800/ 200= 4

Ans.2- (B)

A game that demonstrates the basic problem confronting noncolluding oligopolists is known as the prisoners dilemma

Ans.3- (D)

The elasticity along a linear demand curve is more elastic at higher price ranges and inelastic at lower price ranges.