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2012 AP Microeconomics Practice Exam Multiple Choice Questions Free Download

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10)Which of the following statements about a constant-cost perfectly competitive industry in long-run equilibrium must be true?

  1. An increase in demand will cause no change in the long-run equilibrium price.
  2. An increase in demand will cause no change in the long-run equilibrium quantity.
  3. The long-run supply curve is upward sloping.
  4. The long-run supply curve is perfectly inelastic.
  5. The total cost of production remains the same as output increases.

12)Assume that a profit-maximizing firm is perfectly competitive in both the output and the factor markets and is at its long-run equilibrium. The firm’s output is 100 units, its total revenue is $600.00, and the fixed cost of production is $50.00. Based on this information, which of the following is true for the firm?

  1. Its marginal cost is $5.50, and its average total cost is $5.50.
  2. Its marginal cost is $5.50, and its average variable cost is $5.50.
  3. Its marginal cost is $6.00, and its average total cost is $5.50.
  4. Its marginal cost is $6.00, and its average fixed cost is $5.50.
  5. Its marginal cost is $6.00, and its average variable cost is $5.50.

16)Assume both Italy and Greece produce only two goods: wine and olive oil. If Italy holds a comparative advantage in the production of wine, then which of the following statements is NOT true?

  1. Italy must hold an absolute advantage in the production of wine.
  2. Greece holds a comparative advantage in the production of olive oil.
  3. Italy’s opportunity cost of producing one additional unit of wine is lower than Greece’s.
  4. Greece’s opportunity cost of producing one additional unit of olive oil is lower than Italy’s.
  5. If trade is open between them, these countries have an incentive to trade.

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