_____ Causes of Variation Arise from External Sources That Are

question 46

Multiple Choice

_____ causes of variation arise from external sources that are not inherent in the process.

• A) Special
• B) Unassignable
• C) Common
• D) Non-system

Understand the concept of economic profits and losses in different market structures.

Recognize the factors leading to the emergence of monopolies and how they can maintain their monopoly power.

Identify the role of barriers to entry in maintaining a firm's market power.

Discuss the impact of economies of scale on market structures and firm size.

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Definitions:

Total Cost

The entire cost of production including both fixed and variable costs.

Marginal Cost

The upsurge in total financial outlay occasioned by the production of one supplementary unit of a product or service.

Marginal Revenue

The additional revenue that a firm gains when it sells one more unit of a product.

Monopolist's Profits

The excess earnings a monopolist achieves by setting the price above marginal cost due to lack of competition.