10 Exam Questions
Question 1 10 pts
Identify which of the following described scenarios involve a firm acting in such a way as to incur opportunity costs. Select any/all such scenarios.
- A firm is considering which of up to 4 attractive new market segments to enters and has decided to enter markets #2 and #3 because they offer the most overall revenue.
- A firm is preparing a depreciation schedule for costs that have already been incurred to pursue an opportunity in order to accurately account for its return on investment,
- A firm has taken stock of the costs on its income statement for the purpose of conducting a break-even analysis, and now needs to estimate the break-even quantity.
- A firm holds a number of capital goods and assets with potential productive value, but has not yet identified any opportunities for their use so has chosen to keep them idle.
Question 2 10 pts
Identify which of the following statements are good descriptions of the conditions that exist under market equilibrium. Select anyiall statements that are accurate.
- When a market is in equilibrium, everyone who wants to obtain a good will necessarily be able to buy it
- When a market is in equilibrium, every firm in the industry is earning equal overall profit margins
- When a market is in equilibrium, prices reflect the maximum people are willing to pay for a good
- When a market is in equilibrium, the number of units bought and units offered for sale are equal
