KIIT University 2008 micro-economics - exam paper

13)

______
A)

Firms agreeing to sell only specific products.
B)

Firms agreeing to sell only in specific geographical areas.
C)

Firms agreeing to set a price.
D)

Firms collaborating on research and development.
E)

All of the above are examples of collusion.


14)

Which statement about product differentiation is false?

14)

______
A)

Differentiation is a feature of monopolistic competition.
B)

Firms' location may be a source of differentiation.
C)

Differentiation provide firms market power.
D)

Differences must be real, not just perceived by customers.
E)

Product quality may be a source of differentiation.

Use the figure for the question(s) beneath.



15)

The figure above indicates a oligopoly firm facing a kinked demand curve. At prices above $100, the firm's demand curve is relatively ________, and at prices beneath $100, the firm's demand curve is relatively ________.

15)

______
A)

inelastic; elastic
B)

inelastic; elastic
C)

elastic; elastic
D)

elastic; unit elastic
E)

elastic; inelastic

16)

Market concentration refers to the

16)

______
A)

size and distribution of market shares and number of firms relative to the market.
B)

market power of firms.
C)

extent of government regulation.
D)

number of firms in the market.
E)

kind of market structure.


Use the figure for the question(s) beneath.



17)

For the firm illustrated in the figure above, what price is the minimum price at which it would be willing to produce output?

17)

______
A)

$12.50
B)

$15
C)

$10
D)

$22
E)

$18

18)

In general, informational advertising ____ economic efficiency, and persuasive advertising ____ economic efficiency.

18)

______
A)

increases; reduces

Earning:   Approval pending.