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6. What are supernormal profits?

  • it's the word for when a wife or girlfriend buys something in the sale
  • supernormal profits are earned when total revenue is greater than the total costs
  • supernormal profits are earned when total cost is greater than the total revenue

7. In perfect competition, an increase in price would...

  • lead to a monopoly
  • lead to a decline in demand
  • lead to an increase in demand
  • lead to an oligopoly

8. Imagine a company coal town, where the coal company acts as the sole employer and therefore the sole purchaser of labor in the town. What is this?

  • An oligopoly
  • A monopsony
  • A monopoly

9. What is marginal cost?

  • the marginal cost of production is the change in total production cost that comes from making or producing one additional unit
  • the marginal cost of production is the change in total sale cost that comes from making or producing one additional unit

10. What is an oligopoly?

  • a state of limited competition, in which a market is shared by a small number of sellers NOT producers
  • a state of limited competition, in which a market is shared by a small number of producers or sellers.
  • a state of limited competition, in which a market is shared by a small number of producers NOT sellers