Question 1

The Federal Trade Commission was created by Congress in the same year that the Clayton Act was passed.

Accepted Answer

A) True 
 B)False

Question 2

A profit-maximizing monopolist will ________ where marginal revenue is equal to marginal cost.

Accepted Answer

A)  produce output 
B)  charge the selling price 
C)  minimize its average total cost 
D)  All of the above are correct. 
A)  produce output 
B)  charge the selling price 
C)  minimize its average total cost 
D)  All of the above are correct.

Question 3

Farmers lobbying the government for agricultural price supports are engaging in rent-seeking behavior.

Accepted Answer

A) True 
 B)False

Question 4

If a monopolist is producing an output at a point where ATC > P > MC, then it is

Accepted Answer

A)  breaking even. 
B)  earning positive economic profits. 
C)  earning negative economic profits. 
D)  covering total costs but not total variable costs. 
A)  breaking even. 
B)  earning positive economic profits. 
C)  earning negative economic profits. 
D)  covering total costs but not total variable costs.

Question 5

When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $690. In order to sell three units of output instead of only two, the monopolist must

Accepted Answer

A)  decrease its price by $30 per unit. 
B)  decrease its price by $70 per unit. 
C)  make no change in price and increase output by one unit. 
D)  decrease its price by $90 per unit. 
A)  decrease its price by $30 per unit. 
B)  decrease its price by $70 per unit. 
C)  make no change in price and increase output by one unit. 
D)  decrease its price by $90 per unit.

Question 6

Refer to the information provided in Table 13.1 below to answer the question(s) that follow.
Table 13.1
 $$\begin{array} { | c | c | } 
\hline \text { Price } ( \$ ) & \text { Quantity } \
\hline 4.00 & 2,000 \
\hline 3.50 & 2,400 \
\hline 3.00 & 2,800 \
\hline 2.50 & 3,200 \
\hline 2.00 & 3,600 \
\hline 1.50 & 4,000 \
\hline 1.00 & 4,400 \
\hline
\end{array}$$
-Refer to Table 13.1. If a monopoly faces the demand schedule given in the table and has a constant marginal and average cost of $1 per unit of providing the product, what price should it charge per unit of output so as to maximize its profits?

Accepted Answer

A)  $4.00 
B)  $3.50 
C)  $3.00 
D)  $2.50 
A)  $4.00 
B)  $3.50 
C)  $3.00 
D)  $2.50

Question 7

Which of the following made tying contracts illegal and banned price discrimination with the intent to monopolize?

Accepted Answer

A)  the Clayton Act 
B)  the Federal Trade Commission Act 
C)  the Sherman Act 
D)  the Cellar-Kefauver Act 
A)  the Clayton Act 
B)  the Federal Trade Commission Act 
C)  the Sherman Act 
D)  the Cellar-Kefauver Act

Question 8

Refer to the information provided in Figure 13.6 below to answer the question that follows.   Figure 13.6
-Refer to Figure 13.6. The Memory Company's ________ is $800.

Accepted Answer

A)  total revenue 
B)  total cost 
C)  minimum level of loss 
D)  maximum level of profit 
A)  total revenue 
B)  total cost 
C)  minimum level of loss 
D)  maximum level of profit

Question 9

A monopolist who has a horizontal ATC schedule and perfectly price discriminates

Accepted Answer

A)  leaves buyers a decreased but still positive amount of consumer surplus. 
B)  increases the amount of consumer surplus that is lost to the buyers and not gained by the monopolist. 
C)  appropriates all consumer surplus as profit. 
D)  does not change the amount of consumer surplus that buyers had before the monopolist perfectly price discriminated. 
A)  leaves buyers a decreased but still positive amount of consumer surplus. 
B)  increases the amount of consumer surplus that is lost to the buyers and not gained by the monopolist. 
C)  appropriates all consumer surplus as profit. 
D)  does not change the amount of consumer surplus that buyers had before the monopolist perfectly price discriminated.

Question 10

A monopolist will ________ if marginal revenue is negative.

Accepted Answer

A)  increase production 
B)  maintain its current production level 
C)  not produce 
D)  shut down 
A)  increase production 
B)  maintain its current production level 
C)  not produce 
D)  shut down

Question 11

When a monopolist incurs a loss in the short run, it will stop producing if

Accepted Answer

A)  demand is greater than marginal revenue. 
B)  marginal cost equals marginal revenue. 
C)  total revenue is insufficient to cover variable costs. 
D)  total revenue is insufficient to cover fixed costs. 
A)  demand is greater than marginal revenue. 
B)  marginal cost equals marginal revenue. 
C)  total revenue is insufficient to cover variable costs. 
D)  total revenue is insufficient to cover fixed costs.

Question 12

Refer to the information provided in Figure 13.3 below to answer the question(s) that follow.   Figure 13.3
-Refer to Figure 13.3. This firm's ________ will be maximized at a price of $10.

Accepted Answer

A)  marginal cost 
B)  total revenue 
C)  marginal revenue 
D)  profit 
A)  marginal cost 
B)  total revenue 
C)  marginal revenue 
D)  profit

Question 13

Refer to the information provided in Figure 13.6 below to answer the question that follows.   Figure 13.6
-Refer to Figure 13.6. The profit-maximizing price for the Memory Company's high school yearbook is

Accepted Answer

A)  $0. 
B)  $9. 
C)  $16. 
D)  $20. 
A)  $0. 
B)  $9. 
C)  $16. 
D)  $20.

Question 14

When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $690. When the monopolist sells three units of output, the price per unit is

Accepted Answer

A)  $210. 
B)  $230. 
C)  $300. 
D)  $630. 
A)  $210. 
B)  $230. 
C)  $300. 
D)  $630.

The Federal Trade Commission was created by Congress in the same year that the Clayton Act was passed.

A profit-maximizing monopolist will ________ where marginal revenue is equal to marginal cost.

Farmers lobbying the government for agricultural price supports are engaging in rent-seeking behavior.

If a monopolist is producing an output at a point where ATC > P > MC, then it is

When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $690. In order to sell three units of output instead of only two, the monopolist must

Which of the following made tying contracts illegal and banned price discrimination with the intent to monopolize?

Refer to the information provided in Figure 13.6 below to answer the question that follows. Figure 13.6 -Refer to Figure 13.6. The Memory Company's ________ is $800.

A monopolist who has a horizontal ATC schedule and perfectly price discriminates

A monopolist will ________ if marginal revenue is negative.

When a monopolist incurs a loss in the short run, it will stop producing if

Refer to the information provided in Figure 13.3 below to answer the question(s) that follow. Figure 13.3 -Refer to Figure 13.3. This firm's ________ will be maximized at a price of $10.

Refer to the information provided in Figure 13.6 below to answer the question that follows. Figure 13.6 -Refer to Figure 13.6. The profit-maximizing price for the Memory Company's high school yearbook is

When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $690. When the monopolist sells three units of output, the price per unit is

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Elasticity

Household Behavior and Consumer Choice

The Production Process: the Behavior of Profit-Maximizing Firms

Short-Run Costs and Output Decisions

Long-Run Costs and Output Decisions

Input Demand: the Labor and Land Markets

Input Demand: the Capital Market and the Investment Decision

General Equilibrium and the Efficiency of Perfect Competition

Oligopoly

Monopolistic Competition

Externalities, Public Goods, and Common Resources

Uncertainty and Asymmetric Information

Income Distribution and Poverty

Public Finance: the Economics of Taxation

International Trade, Comparative Advantage, and Protectionism

Economic Growth in Developing Economies

Critical Thinking About Research

Filters

Exam 13: Monopoly and Antitrust Policy

The Federal Trade Commission was created by Congress in the same year that the Clayton Act was passed.

A profit-maximizing monopolist will ________ where marginal revenue is equal to marginal cost.

Farmers lobbying the government for agricultural price supports are engaging in rent-seeking behavior.

If a monopolist is producing an output at a point where ATC > P > MC, then it is

When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $690. In order to sell three units of output instead of only two, the monopolist must

Which of the following made tying contracts illegal and banned price discrimination with the intent to monopolize?

Refer to the information provided in Figure 13.6 below to answer the question that follows. Figure 13.6 -Refer to Figure 13.6. The Memory Company's ________ is $800.

A monopolist who has a horizontal ATC schedule and perfectly price discriminates

A monopolist will ________ if marginal revenue is negative.

When a monopolist incurs a loss in the short run, it will stop producing if

Refer to the information provided in Figure 13.3 below to answer the question(s) that follow. Figure 13.3 -Refer to Figure 13.3. This firm's ________ will be maximized at a price of $10.

Refer to the information provided in Figure 13.6 below to answer the question that follows. Figure 13.6 -Refer to Figure 13.6. The profit-maximizing price for the Memory Company's high school yearbook is

When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $690. When the monopolist sells three units of output, the price per unit is

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Elasticity

Household Behavior and Consumer Choice

The Production Process: the Behavior of Profit-Maximizing Firms

Short-Run Costs and Output Decisions

Long-Run Costs and Output Decisions

Input Demand: the Labor and Land Markets

Input Demand: the Capital Market and the Investment Decision

General Equilibrium and the Efficiency of Perfect Competition

Oligopoly

Monopolistic Competition

Externalities, Public Goods, and Common Resources

Uncertainty and Asymmetric Information

Income Distribution and Poverty

Public Finance: the Economics of Taxation

International Trade, Comparative Advantage, and Protectionism

Economic Growth in Developing Economies

Critical Thinking About Research

Filters