Micro

Question 1

perfect competition short run

Answer 1

p = MC if MC > AVC

Question 2

perfect competition long run

Answer 2

p = min LRAC

Question 3

Monopoly

Answer 3

MC = MR

Question 4

monopolistic short run

Answer 4

mc=mr

Question 5

monpolistic long run

Answer 5

p = atc

Question 6

what is pareto equilibrium

Answer 6

no one can be made better off without making someone worse off

Question 7

What are the characteristics of perfect competition?

Answer 7

Many firms, identical products, no barriers to entry, price takers, perfect information

Question 8

What is a Nash equilibrium

Answer 8

A situation where no player can benefit by changing strategies while the other player’s strategy remains the same

Question 9

which mover has advantage in price competition

Answer 9

second mover

Question 10

which mover has advantage in quantity competition

Answer 10

first mover

Question 11

can avverage costs rise while marginal costs are declining

Answer 11

yes

Question 12

do monopolies produce efficient output

Answer 12

no

Question 13

what is an isoquant

Answer 13

the combinations of capital and labour that produce the same output

Question 14

what are the conditions of a pareto optimal point

Answer 14

Xa+ Xb = total x Ya+Yb = total y
there is no way to make one consumer better off without making another worse off

Question 15

what are the conditions of competitive equilibrium

Answer 15

markets must clear
consumers maximise their utility subject to their budget constraint

Question 16

what is the first welfare theorem

Answer 16

any competitive equilibrium is pareto efficient

Question 17

what is the second welfare theorem

Answer 17

any pareto efficinet allocatino can be achieved as a competitive equilibrium with appropriate wealth redistribution