Question 1

Exhibit 24-4
  
-Refer to Exhibit 24-4. What dollar amounts go in blanks (K),(L),(M),and (N),respectively?

Accepted Answer

A)  $90; $80; $53.33; and $60 
B)  $90; $70; $50; and $30 
C)  $133; $45; $35; and $25 
D)  $0; $90; $160; and $210 
A)  $90; $80; $53.33; and $60 
B)  $90; $70; $50; and $30 
C)  $133; $45; $35; and $25 
D)  $0; $90; $160; and $210

Question 2

Monopolists are guaranteed to earn a positive economic profit because they are the only seller in their industry.

Accepted Answer

A) True 
 B)False

Question 3

Exhibit 24-9
  
-Refer to Exhibit 24-9.Assuming that the firm is maximizing profits,the marginal revenue of the last unit produced equals

Accepted Answer

A)  $4. 
B)  $40. 
C)  $5. 
D)  $50. 
E)  $6. 
A)  $4. 
B)  $40. 
C)  $5. 
D)  $50. 
E)  $6.

Question 4

For a firm that perfectly price discriminates,

Accepted Answer

A)  price is less than marginal revenue. 
B)  price is greater than marginal revenue. 
C)  price equals marginal revenue. 
D)  price has no definite relationship with marginal revenue. 
A)  price is less than marginal revenue. 
B)  price is greater than marginal revenue. 
C)  price equals marginal revenue. 
D)  price has no definite relationship with marginal revenue.

Question 5

Exhibit 24-3
  
-Refer to Exhibit 24-3.The profit-maximizing single-price monopolist charges price

Accepted Answer

A)  P1. 
B)  P2. 
C)  P3. 
D)  P4. 
E)  P5. 
A)  P1. 
B)  P2. 
C)  P3. 
D)  P4. 
E)  P5.

Question 6

Which of the following is an assumption of the theory of monopoly?

Accepted Answer

A)  There are extremely high barriers to entry. 
B)  There are many sellers. 
C)  The product has a number of close substitutes. 
D)  The product is of extremely high quality. 
A)  There are extremely high barriers to entry. 
B)  There are many sellers. 
C)  The product has a number of close substitutes. 
D)  The product is of extremely high quality.

Question 7

Which of the following statements is false?

Accepted Answer

A)  The monopolist has the ability to control to some degree the price of the product it sells. 
B)  The monopolist faces a downward-sloping demand curve. 
C)  The monopolist is a price taker. 
D)  The monopoly firm is the industry. 
A)  The monopolist has the ability to control to some degree the price of the product it sells. 
B)  The monopolist faces a downward-sloping demand curve. 
C)  The monopolist is a price taker. 
D)  The monopoly firm is the industry.

Question 8

Describe the similarities between why sellers want to price discriminate and why district attorneys want to plea-bargain. In addition,discuss the conditions that must be satisfied before district attorneys (DAs)can plea-bargain successfully and how they relate to the three conditions necessary for successful price discrimination.

Accepted Answer

Sellers want to maximize profits,and pri

Question 9

Third-degree price discrimination is discrimination among

Accepted Answer

A)  units. 
B)  quantities. 
C)  buyers. 
D)  prices. 
A)  units. 
B)  quantities. 
C)  buyers. 
D)  prices.

Question 10

If a monopolist practices perfect price discrimination,then it will have

Accepted Answer

A)  a greater total revenue and sell a greater output than if it were not practicing price discrimination. 
B)  a smaller total revenue and sell a smaller output than if it were not practicing price discrimination. 
C)  the same total revenue but sell a larger output than if it were not practicing price discrimination. 
D)  the same total revenue but sell a smaller output than if it were not practicing price discrimination. 
A)  a greater total revenue and sell a greater output than if it were not practicing price discrimination. 
B)  a smaller total revenue and sell a smaller output than if it were not practicing price discrimination. 
C)  the same total revenue but sell a larger output than if it were not practicing price discrimination. 
D)  the same total revenue but sell a smaller output than if it were not practicing price discrimination.

Question 11

Price discrimination occurs when a seller charges different prices for its product and the price differences result from differences in the costs of production.

Accepted Answer

A) True 
 B)False

Question 12

If a monopolist wishes to sell an additional unit of the good,then

Accepted Answer

A)  it must raise its price to signal consumers that its product is now a more important part of their budget, and they will purchase more. 
B)  like a competitive firm, it can simply make more output available and not lower price. 
C)  it must lower price. 
D)  it can raise price and not worry that sales will decrease. 
E)  a and d 
A)  it must raise its price to signal consumers that its product is now a more important part of their budget, and they will purchase more. 
B)  like a competitive firm, it can simply make more output available and not lower price. 
C)  it must lower price. 
D)  it can raise price and not worry that sales will decrease. 
E)  a and d

Question 13

Exhibit 24-4
  
-Refer to Exhibit 24-4. What dollar amounts go in blanks (T),(U)and (V),respectively?

Accepted Answer

A)  $25; $30; and $40 
B)  $16; $19.50; and $23.60 
C)  $30; $40; and $29 
D)  $23; $15; and $28 
A)  $25; $30; and $40 
B)  $16; $19.50; and $23.60 
C)  $30; $40; and $29 
D)  $23; $15; and $28

Question 14

Exhibit 24-4
  
-Refer to Exhibit 24-4. What dollar amounts go in blanks (F),(G),(H),(I),and (J),respectively?

Accepted Answer

A)  $120; $125; $8; $28; and $38 
B)  $9; $70; $50; $30; and $10 
C)  $250; $15; $10; $30; and $50 
D)  $100; $90; $8; $28; and $48 
A)  $120; $125; $8; $28; and $38 
B)  $9; $70; $50; $30; and $10 
C)  $250; $15; $10; $30; and $50 
D)  $100; $90; $8; $28; and $48

Question 15

Explain why price is greater than marginal revenue for a single-price monopolist and how this differs from perfect competition.

Accepted Answer

A monopolist faces a downward-sloping de

Question 16

Legal barriers to entry include patents,government licenses and economies of scale.

Accepted Answer

A) True 
 B)False

Question 17

Exhibit 24-9
  
-Refer to Exhibit 24-9.Total fixed costs are equal to.

Accepted Answer

A)  $0. 
B)  $10. 
C)  $25. 
D)  $59. 
E)  There is not enough information to answer the question. 
A)  $0. 
B)  $10. 
C)  $25. 
D)  $59. 
E)  There is not enough information to answer the question.

Question 18

Which of the following statements is false?

Accepted Answer

A)  The monopolist faces a horizontal demand curve. 
B)  For the single-price monopolist, marginal revenue is less than price. 
C)  For the monopolist, revenue maximization and profit maximization are usually not the same. 
D)  The monopolist is a price searcher. 
A)  The monopolist faces a horizontal demand curve. 
B)  For the single-price monopolist, marginal revenue is less than price. 
C)  For the monopolist, revenue maximization and profit maximization are usually not the same. 
D)  The monopolist is a price searcher.

Question 19

The perfectly competitive firm charges a price equal to __________ while the monopolist charges a price __________.

Accepted Answer

A)  marginal revenue; equal to marginal cost 
B)  marginal cost; greater than marginal cost 
C)  marginal revenue; greater than marginal revenue 
D)  average total cost; greater than average total cost 
E)  b and c 
A)  marginal revenue; equal to marginal cost 
B)  marginal cost; greater than marginal cost 
C)  marginal revenue; greater than marginal revenue 
D)  average total cost; greater than average total cost 
E)  b and c

Question 20

A single-price monopolist sets a price of $35 and is selling more than one unit of the product.Which of the following is true?

Accepted Answer

A)  The average cost of that unit must be $35. 
B)  The marginal cost of that unit must be $35. 
C)  The marginal revenue of that unit must be $35. 
D)  The marginal revenue of that unit must be less than $35. 
A)  The average cost of that unit must be $35. 
B)  The marginal cost of that unit must be $35. 
C)  The marginal revenue of that unit must be $35. 
D)  The marginal revenue of that unit must be less than $35.

Exam 24: Monopoly

Exhibit 24-4 -Refer to Exhibit 24-4. What dollar amounts go in blanks (K),(L),(M),and (N),respectively?

Monopolists are guaranteed to earn a positive economic profit because they are the only seller in their industry.

Exhibit 24-9 -Refer to Exhibit 24-9.Assuming that the firm is maximizing profits,the marginal revenue of the last unit produced equals

For a firm that perfectly price discriminates,

Exhibit 24-3 -Refer to Exhibit 24-3.The profit-maximizing single-price monopolist charges price

Which of the following is an assumption of the theory of monopoly?

Which of the following statements is false?

Third-degree price discrimination is discrimination among

If a monopolist practices perfect price discrimination,then it will have

Price discrimination occurs when a seller charges different prices for its product and the price differences result from differences in the costs of production.

If a monopolist wishes to sell an additional unit of the good,then

Exhibit 24-4 -Refer to Exhibit 24-4. What dollar amounts go in blanks (T),(U)and (V),respectively?

Exhibit 24-4 -Refer to Exhibit 24-4. What dollar amounts go in blanks (F),(G),(H),(I),and (J),respectively?

Explain why price is greater than marginal revenue for a single-price monopolist and how this differs from perfect competition.

Legal barriers to entry include patents,government licenses and economies of scale.

Exhibit 24-9 -Refer to Exhibit 24-9.Total fixed costs are equal to.

Which of the following statements is false?

The perfectly competitive firm charges a price equal to __________ while the monopolist charges a price __________.

A single-price monopolist sets a price of $35 and is selling more than one unit of the product.Which of the following is true?

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free, Controlled, and Relative

Supply, Demand, and Price: Applications

Macroeconomic Measurements: Prices and Unemployment

Macroeconomic Measurements: GDP and Real GDP

Aggregate Demand and Aggregate Supply

Classical Macroeconomics and the Self Regulating Economy

Keynesian Macroeconomics and Economic Instability: A Critique of the Self-Regulating Economy

Fiscal Policy and the Federal Budget

Money, Banking,and the Financial System

The Federal Reserve System

Money and the Economy

Monetary Policy

Expectations Theory and the Economy

Economic Growth: Resources, Technology, Ideas, and Institutions

The Financial Crisis of 2007-2009

Debates in Macroeconomics Over the Role and Effects of Government

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopolistic Competition, Oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

Wages,Unions,and Labor

The Distribution of Income and Poverty

Interest, Rent, and Profit

Market Failure: Externalities, Public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

Globalization and International Impacts on the Economy

The Economic Case For and Against Government: Five Topics Considered

Stocks, Bonds, Futures, and Options

Agriculture: Problems, Policies, and Unintended Effects

Filters

The perfectly competitive firm charges a price equal to while the monopolist charges a price .