Tackle the Test: Free-Response Questions

  1. Question

    FcVLHjuHdwPaIOQXt18IbpjKNKsTxQUItlcS/Iy6zJl3c6BOZYGL7OsLaPMfkHLnM/kGnqoFhrYYoNtgIJDPvX/Acy9mRcGE/FdjILb2r3XhQtBE/O6B4k8Ft7jLfU/hOssFisLqoKoavh3IQOi+6L9UR96x6uQdAtmnSB0RKudG8SR07GTkIQKV1qvvvta8unSzzxiidde6QyJ0hPY1X2elKlGuoIRUCBTiMlAdYjZbVRu5fRxb1c37sferN7eCvnlIxhpcbB2gu/Wz2S9j7/36iHIvNqNUeD7R9A==

    Rubric for FRQ 1 (7 points)

    image

    1 point: Axes are correctly labeled.

    1 point: Demand curve is horizontal and labeled with some combination of “P,” “MR,” or “D.”

    1 point: Marginal cost curve is labeled and slopes upward.

    1 point: Profit-maximizing quantity is labeled on horizontal axis where MC = MR.

    1 point: Average total cost curve is labeled and U-shaped.

    1 point: Average total cost is equal to price at the profit-maximizing output.

    1 point: Marginal cost curve crosses the average total cost curve at the lowest point on the average total cost curve.

  2. Question

    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
    Suppose that paper is produced in a perfectly competitive, increasing-cost industry.