Microeconomics Unit 3 Quiz

What does the law of diminishing marginal returns imply?

• Resources have no impact on output.

• Output remains constant regardless of resources added.

• Additional resources eventually lead to decreased additional output.

• Adding more resources always increases output.

Which of the following is NOT a type of cost discussed in the first section?

• Marginal cost

• Variable cost

• Total cost

• Fixed cost

What is the primary focus of the second section?

• Understanding the law of diminishing returns

• Discussing fixed and variable costs

• Exploring long-run cost curves and market structures

• Calculating average costs

Which market structure is characterized by many firms and identical products?

• Oligopoly

• Monopolistic competition

• Monopoly

• Perfect competition

How do firms typically use marginal analysis in decision-making?

• By considering additional costs and benefits of decisions

• By calculating exact marginal costs for each unit

• By focusing only on fixed costs

• By ignoring marginal costs altogether