Question 1

The table below gives a monopoly's demand schedule.Complete the table by calculating the total revenue and the marginal revenue.

Accepted Answer

@#IMG-DLM& The compl

Question 2

For a single-price monopoly,price is

Accepted Answer

A)  greater than marginal revenue. 
B)  one half of marginal revenue. 
C)  equal to marginal revenue. 
D)  unrelated to marginal revenue. 
E)  always less than average total cost when the firm maximizes its profit. 
A)  greater than marginal revenue. 
B)  one half of marginal revenue. 
C)  equal to marginal revenue. 
D)  unrelated to marginal revenue. 
E)  always less than average total cost when the firm maximizes its profit.

Question 3

Which of the following statements is correct?

Accepted Answer

A)  Monopolies are guaranteed to earn an economic profit. 
B)  The market demand and the firm's demand are the same for a monopoly. 
C)  Monopolies have perfectly inelastic demand for the product sold. 
D)  Because a monopoly is the only firm in the market, its supply curve is the same as the market demand curve. 
E)  Because a monopoly is the only firm in the market, its marginal revenue curve must be the same as the market demand curve. 
A)  Monopolies are guaranteed to earn an economic profit. 
B)  The market demand and the firm's demand are the same for a monopoly. 
C)  Monopolies have perfectly inelastic demand for the product sold. 
D)  Because a monopoly is the only firm in the market, its supply curve is the same as the market demand curve. 
E)  Because a monopoly is the only firm in the market, its marginal revenue curve must be the same as the market demand curve.

Question 4

-In the above figure,the profit-maximizing output for this single-price monopoly is ________ units and the price is ________.

Accepted Answer

A)  200; $10 
B)  300; $20 
C)  500; $50 
D)  200; $30 
E)  300; $30 
A)  200; $10 
B)  300; $20 
C)  500; $50 
D)  200; $30 
E)  300; $30

Question 5

Compare and contrast the marginal cost and average cost pricing rules for regulating natural monopolies.

Accepted Answer

Marginal cost pricing sets the price equ

Question 6

Which of the following is an example of price discrimination?

Accepted Answer

A)  UPS charges more if a package is sent from New York to Hawaii and less if it is sent from New York to New Jersey. 
B)  Frank's Furniture shop charges no delivery fee for furniture delivered within Dutchess County but charges $40 delivery fee outside of the county. 
C)  Albert pays 25 percent less on prescription drugs because he is a senior citizen. 
D)  Only answers A and B are correct. 
E)  Answers A, B, and C are all correct. 
A)  UPS charges more if a package is sent from New York to Hawaii and less if it is sent from New York to New Jersey. 
B)  Frank's Furniture shop charges no delivery fee for furniture delivered within Dutchess County but charges $40 delivery fee outside of the county. 
C)  Albert pays 25 percent less on prescription drugs because he is a senior citizen. 
D)  Only answers A and B are correct. 
E)  Answers A, B, and C are all correct.

Question 7

Which of the following is NOT a requirement for a firm to be able to price discriminate?

Accepted Answer

A)  monopoly power 
B)  groups of customers with different willingness to pay for the good 
C)  economies of scale 
D)  ability to keep the members of different customer groups separate 
E)  ability to prevent resales of the product by customers 
A)  monopoly power 
B)  groups of customers with different willingness to pay for the good 
C)  economies of scale 
D)  ability to keep the members of different customer groups separate 
E)  ability to prevent resales of the product by customers

Question 8

A price-discriminating monopoly charges

Accepted Answer

A)  the same price to every buyer for the same product. 
B)  a different price to different types of buyers for the same product, even though there are no differences in costs. 
C)  a different price to different buyers, because the costs are different. 
D)  different prices to buyers for different products. 
E)  each customer a price that equals the marginal cost of serving that customer. 
A)  the same price to every buyer for the same product. 
B)  a different price to different types of buyers for the same product, even though there are no differences in costs. 
C)  a different price to different buyers, because the costs are different. 
D)  different prices to buyers for different products. 
E)  each customer a price that equals the marginal cost of serving that customer.

Question 9

Compare and contrast the effect of perfect competition to the effect of perfect price discrimination on:
a.efficiency.
b.consumer surplus.
c.economic profit in the long run.

Accepted Answer

a.Both perfect competition and perfect p

Question 10

Which of the following is an example of a person or firm that is most likely to have been granted a public franchise?

Accepted Answer

A)  medical doctor 
B)  taxi cab driver 
C)  the local pizza parlor 
D)  the local telephone company 
E)  the local Honda dealership 
A)  medical doctor 
B)  taxi cab driver 
C)  the local pizza parlor 
D)  the local telephone company 
E)  the local Honda dealership

Question 11

Patents

Accepted Answer

A)  are a legal barrier to entry. 
B)  remove legal barriers to entry. 
C)  create economies of scale. 
D)  decrease the incentive to innovate. 
E)  are prohibited in the United States. 
A)  are a legal barrier to entry. 
B)  remove legal barriers to entry. 
C)  create economies of scale. 
D)  decrease the incentive to innovate. 
E)  are prohibited in the United States.

Question 12

-The above figure illustrates the market for electric power that is served by the one utility in Alberta,Canada.
a.If the government did not regulate this utility,what would be the price of a kilowatt hour in this region and how much power would be generated?
b.If the government regulates the utility and chooses an average cost pricing rule,what would be the price of a kilowatt hour and how much power would be generated?
c.If the government regulates the utility and chooses a marginal cost pricing rule,what would be the price of a kilowatt hour and how much power would be generated?

Accepted Answer

a.The price would be 12¢ a kilowatt hour

Question 13

Which of the following is (are)price discrimination?
i.charging different prices based on differences in production cost
ii.charging business flyers a higher airfare than tourists
iii.charging more for the first pizza than the second

Accepted Answer

A)  i only 
B)  ii only 
C)  ii and iii 
D)  i and iii 
E)  i, ii, and iii 
A)  i only 
B)  ii only 
C)  ii and iii 
D)  i and iii 
E)  i, ii, and iii

Question 14

Which of the following is ALWAYS true when a single-price monopolist maximizes its profit?

Accepted Answer

A)  P = MC 
B)  P = MR 
C)  MR = MC 
D)  MC = ATC 
E)  P > ATC 
A)  P = MC 
B)  P = MR 
C)  MR = MC 
D)  MC = ATC 
E)  P > ATC

Question 15

What is a legal barrier to entry?

Accepted Answer

A legal barrier to entry arise

Question 16

Why are water companies considered a natural monopoly?

Accepted Answer

Once one water company incurs the cost o

Question 17

Price discrimination is possible,in part,because

Accepted Answer

A)  costs of production vary as output increases. 
B)  monopolies are regulated. 
C)  monopolies don't profit maximize. 
D)  the willingness to pay can vary among groups of buyers. 
E)  monopolies face horizontal demand curves. 
A)  costs of production vary as output increases. 
B)  monopolies are regulated. 
C)  monopolies don't profit maximize. 
D)  the willingness to pay can vary among groups of buyers. 
E)  monopolies face horizontal demand curves.

Question 18

A monopoly

Accepted Answer

A)  must determine the price it will charge. 
B)  faces extensive competition from firms making close substitutes. 
C)  cannot price discriminate because such a pricing strategy is illegal in the United States. 
D)  has no control over the price it can charge. 
E)  Both answers B and C are correct. 
A)  must determine the price it will charge. 
B)  faces extensive competition from firms making close substitutes. 
C)  cannot price discriminate because such a pricing strategy is illegal in the United States. 
D)  has no control over the price it can charge. 
E)  Both answers B and C are correct.

Question 19

-The table above gives the demand for a monopolist's output.What is the total revenue in when 3 units of output are produced?

Accepted Answer

A)  $21 
B)  $20 
C)  $18 
D)  $6 
A)  $21 
B)  $20 
C)  $18 
D)  $6

Question 20

A natural monopoly that is regulated to set price equal to marginal cost

Accepted Answer

A)  makes an economic profit. 
B)  makes zero economic profit. 
C)  incurs an economic loss. 
D)  could make an economic loss, an economic profit, or zero economic profit. 
E)  makes zero normal profit. 
A)  makes an economic profit. 
B)  makes zero economic profit. 
C)  incurs an economic loss. 
D)  could make an economic loss, an economic profit, or zero economic profit. 
E)  makes zero normal profit.

The table below gives a monopoly's demand schedule.Complete the table by calculating the total revenue and the marginal revenue.

For a single-price monopoly,price is

Which of the following statements is correct?

-In the above figure,the profit-maximizing output for this single-price monopoly is units and the price is .

Compare and contrast the marginal cost and average cost pricing rules for regulating natural monopolies.

Which of the following is an example of price discrimination?

Which of the following is NOT a requirement for a firm to be able to price discriminate?

A price-discriminating monopoly charges

Compare and contrast the effect of perfect competition to the effect of perfect price discrimination on: a.efficiency. b.consumer surplus. c.economic profit in the long run.

Which of the following is an example of a person or firm that is most likely to have been granted a public franchise?

Patents

Which of the following is (are)price discrimination? i.charging different prices based on differences in production cost ii.charging business flyers a higher airfare than tourists iii.charging more for the first pizza than the second

Which of the following is ALWAYS true when a single-price monopolist maximizes its profit?

What is a legal barrier to entry?

Why are water companies considered a natural monopoly?

Price discrimination is possible,in part,because

A monopoly

-The table above gives the demand for a monopolist's output.What is the total revenue in when 3 units of output are produced?

A natural monopoly that is regulated to set price equal to marginal cost

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 16: Monopoly

The table below gives a monopoly's demand schedule.Complete the table by calculating the total revenue and the marginal revenue.

For a single-price monopoly,price is

Which of the following statements is correct?

-In the above figure,the profit-maximizing output for this single-price monopoly is ________ units and the price is ________.

Compare and contrast the marginal cost and average cost pricing rules for regulating natural monopolies.

Which of the following is an example of price discrimination?

Which of the following is NOT a requirement for a firm to be able to price discriminate?

A price-discriminating monopoly charges

Compare and contrast the effect of perfect competition to the effect of perfect price discrimination on: a.efficiency. b.consumer surplus. c.economic profit in the long run.

Which of the following is an example of a person or firm that is most likely to have been granted a public franchise?

Patents

Which of the following is (are)price discrimination? i.charging different prices based on differences in production cost ii.charging business flyers a higher airfare than tourists iii.charging more for the first pizza than the second

Which of the following is ALWAYS true when a single-price monopolist maximizes its profit?

What is a legal barrier to entry?

Why are water companies considered a natural monopoly?

Price discrimination is possible,in part,because

A monopoly

-The table above gives the demand for a monopolist's output.What is the total revenue in when 3 units of output are produced?

A natural monopoly that is regulated to set price equal to marginal cost

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

-In the above figure,the profit-maximizing output for this single-price monopoly is units and the price is .