Question

Producer surplus is defined as

a.the quantity of a good that is profit maximizing for the firm

b.various quantities of a good that bring equal profit to the firm

c.the difference between the market price and marginal cost of a good

d.the difference between what a firm is willing to sell for and what it actually receives

In a firm production model, it is typically assumed that the marginal product from an input (e.g. workers):

a.is constant over early and later stages of production.

b.is high in the short-run but low in the long-run.

c.is higher at the earlier stages of production.

d.is higher at the later stages of production.

Which of the following is not a dimension of market structure discussed in class?

a. the distribution of consumer preferences

b. barriers to entry

c. number of firms in the market

d. standardization of the good or service

Answer 1

1. D difference between price for what a firm is willing to sell and what it recieves

2. A is constant over early and later stages.

3. A Distribution of consumer preferences as it doesnot define structure of market and only defines choice of customers