Question 1

A monopolist will increase output to the point where MR equals MC and not beyond.

Accepted Answer

A) True 
 B)False

Question 2

Figure 11-5  
-Crown Theater is the only movie theater in the city.Its cost and revenue curves are shown in Figure 11-5.Monopolist Crown Theater would set the price of its tickets at

Accepted Answer

A) $7.50. 
B) $6.00. 
C) $4.50. 
D) $3.00. 
A) $7.50. 
B) $6.00. 
C) $4.50. 
D) $3.00.

Question 3

Figure 11-6  
-The profit-maximizing monopolist in Figure 11-6 will produce ____ units of output.

Accepted Answer

A) Q1 
B) Q2 
C) Q3 
D) Q4 
A) Q1 
B) Q2 
C) Q3 
D) Q4

Question 4

"Intel Inside" accompanies virtually all IBM-compatible computers.Intel manufactures the i3, i5 and i7 chips that are a key component of personal computers.Does Intel have a monopoly?

Accepted Answer

To be a monopoly, a firm must not only b

Question 5

The ability to keep rivals out of the market is the recipe for creating and maintaining a monopoly.

Accepted Answer

A) True 
 B)False

Question 6

Figure 11-7  
-Monopolists may in the long run

Accepted Answer

A) earn positive economic profit. 
B) be protected by barriers to entry. 
C) grow wealthy at the expense of their consumers. 
D) All of these responses are correct. 
A) earn positive economic profit. 
B) be protected by barriers to entry. 
C) grow wealthy at the expense of their consumers. 
D) All of these responses are correct.

Question 7

Table 11-2   ​
-In Table 11-2, marginal revenue at the profit-maximizing output is how much?

Accepted Answer

A) $5 
B) $7 
C) $8 
D) $110 
A) $5 
B) $7 
C) $8 
D) $110

Question 8

The monopoly producer

Accepted Answer

A) sets MU equal to P. 
B) sets MR = MC. 
C) has MC > MU. 
D) sets MR = P. 
A) sets MU equal to P. 
B) sets MR = MC. 
C) has MC > MU. 
D) sets MR = P.

Question 9

A monopolist's demand curve implies that

Accepted Answer

A) the monopolist is a price taker. 
B) the monopolist is a price maker. 
C) it has nothing to do with the amount a monopolist can sell. 
D) it can be downward sloping or horizontal depending on the price. 
A) the monopolist is a price taker. 
B) the monopolist is a price maker. 
C) it has nothing to do with the amount a monopolist can sell. 
D) it can be downward sloping or horizontal depending on the price.

Question 10

A natural monopoly is characterized by the fact that its average costs increase rather than decrease when its output expands.

Accepted Answer

A) True 
 B)False

Question 11

Figure 11-3  
-Using the graph in Figure 11-3, the profit-maximizing monopolist will charge a price

Accepted Answer

A) of more than $3. 
B) of $3. 
C) between $2 and $3. 
D) of $2. 
A) of more than $3. 
B) of $3. 
C) between $2 and $3. 
D) of $2.

Question 12

A monopolist's cost curves will

Accepted Answer

A) be identical to those of a competitive firm. 
B) be higher than a competitive firm's cost curves. 
C) be peculiar to the individual producer since there is only one. 
D) drop more steeply as output increases. 
A) be identical to those of a competitive firm. 
B) be higher than a competitive firm's cost curves. 
C) be peculiar to the individual producer since there is only one. 
D) drop more steeply as output increases.

Question 13

Figure 11-2  
-Since a monopoly faces a downward-sloping demand curve,

Accepted Answer

A) then, as Adam Smith wrote, "the price of monopoly is upon every occasion the highest which can be got." 
B) price always exceeds average revenue. 
C) marginal revenue increases as output increases. 
D) the monopolist is a price maker. 
A) then, as Adam Smith wrote, "the price of monopoly is upon every occasion the highest which can be got." 
B) price always exceeds average revenue. 
C) marginal revenue increases as output increases. 
D) the monopolist is a price maker.

Question 14

In the long run, profit-maximizing monopolists facing a downward-sloping demand curve

Accepted Answer

A) can obtain profits greater than their opportunity costs of capital. 
B) can produce where average total costs are minimized 
C) can have a price that is the same as marginal revenue. 
D) All of these responses are correct. 
A) can obtain profits greater than their opportunity costs of capital. 
B) can produce where average total costs are minimized 
C) can have a price that is the same as marginal revenue. 
D) All of these responses are correct.

Question 15

Which of the following is true for a profit-maximizing competitive firm in the long run but not a monopolist?

Accepted Answer

A) MC = MR. 
B) MC = P. 
C) AR = P. 
D) Q > 0. 
A) MC = MR. 
B) MC = P. 
C) AR = P. 
D) Q > 0.

Question 16

A price-discriminating firm will always maximize profit by following the condition that

Accepted Answer

A) MR > MC. 
B) MR > P. 
C) MRa = MRb = MC. 
D) MR = ATC. 
A) MR > MC. 
B) MR > P. 
C) MRa = MRb = MC. 
D) MR = ATC.

Question 17

In cases of natural monopolies, society would be better off with many firms competing with each other.

Accepted Answer

A) True 
 B)False

Question 18

For natural monopoly markets, government regulators frequently encourage competition among a number of firms.

Accepted Answer

A) True 
 B)False

Question 19

Figure 11-4  
-Physicians have two types of patients: private patients who pay directly or with insurance, and Medicaid patients whose care is paid for by the state.Physicians must lower prices to attract more private patients, but they can add unlimited Medicaid patients at a constant price.The situation facing Dr.Casey is depicted in Figure 11-4.Units of medical service (say, number of patients × number of visits) are measured on the horizontal axis.How many units of medical service will Dr.Casey deliver to Medicaid patients?

Accepted Answer

A) OA 
B) AC 
C) OC 
D) OD 
A) OA 
B) AC 
C) OC 
D) OD

Question 20

Monopoly firms may lead to higher costs than perfectly competitive firms.

Accepted Answer

A) True 
 B)False

Exam 12: Monopoly

A monopolist will increase output to the point where MR equals MC and not beyond.

Figure 11-5 -Crown Theater is the only movie theater in the city.Its cost and revenue curves are shown in Figure 11-5.Monopolist Crown Theater would set the price of its tickets at

Figure 11-6 -The profit-maximizing monopolist in Figure 11-6 will produce ____ units of output.

"Intel Inside" accompanies virtually all IBM-compatible computers.Intel manufactures the i3, i5 and i7 chips that are a key component of personal computers.Does Intel have a monopoly?

The ability to keep rivals out of the market is the recipe for creating and maintaining a monopoly.

Figure 11-7 -Monopolists may in the long run

Table 11-2 ​ -In Table 11-2, marginal revenue at the profit-maximizing output is how much?

The monopoly producer

A monopolist's demand curve implies that

A natural monopoly is characterized by the fact that its average costs increase rather than decrease when its output expands.

Figure 11-3 -Using the graph in Figure 11-3, the profit-maximizing monopolist will charge a price

A monopolist's cost curves will

Figure 11-2 -Since a monopoly faces a downward-sloping demand curve,

In the long run, profit-maximizing monopolists facing a downward-sloping demand curve

Which of the following is true for a profit-maximizing competitive firm in the long run but not a monopolist?

A price-discriminating firm will always maximize profit by following the condition that

In cases of natural monopolies, society would be better off with many firms competing with each other.

For natural monopoly markets, government regulators frequently encourage competition among a number of firms.

Monopoly firms may lead to higher costs than perfectly competitive firms.

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

The Economics of the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Useconomy

Filters

Table 11-2 -In Table 11-2, marginal revenue at the profit-maximizing output is how much?