ECO 561 Course Great Wisdom / tutorialrank.com ECO 561 Course Great Wisdom / tutorialrank.com | Page 16

occurs randomly. C. arises mainly from government subsidies. D.
occurs
accidentally.
26) Firm X develops a new product and gets a head start in its
production. Other
firms try to produce a similar product but discover they have higher
average total
costs than the existing firm. This situation illustrates: A. learning-bydoing. B.
diseconomies of scale. C. spillover costs. D. diminishing marginal
returns.
27) In the long run a pure monopolist will maximize profits by
producing that
output at which marginal cost is equal to: A. average variable cost. B.
average total
cost. C. average cost. D. marginal revenue.
28) If the U.S. unemployment rate is 9 percent, we can infer that: A.
the economy is
in the expansion phase of the business cycle. B. actual GDP is equal
to potential GDP.
C. potential GDP is in excess of actual GDP. D. actual GDP is in
excess of potential
GDP.