Question 1

Monopolies charge

Accepted Answer

A) the highest possible price 
B) a price determined by cost 
C) the price consistent with the output level where total revenue equals total cost 
D) the price associated with the quantity at which marginal revenue equals marginal cost 
E) the price at which total revenue equals average total cost 
A) the highest possible price 
B) a price determined by cost 
C) the price consistent with the output level where total revenue equals total cost 
D) the price associated with the quantity at which marginal revenue equals marginal cost 
E) the price at which total revenue equals average total cost

Question 2

-The firm in Figure 10-15 has

Accepted Answer

A) an economic loss of $25,000 
B) an economic loss of $12,500 
C) an economic profit of $6,250 
D) neither an economic profit nor an economic loss 
E) an economic loss of $16,000 
A) an economic loss of $25,000 
B) an economic loss of $12,500 
C) an economic profit of $6,250 
D) neither an economic profit nor an economic loss 
E) an economic loss of $16,000

Question 3

If a perfectly competitive industry is taken over by a monopolist,the market price will rise

Accepted Answer

A) due to improvements in technology 
B) assuming that technology is unchanged 
C) and output will rise 
D) unless barriers to entry are imposed 
E) until they equal marginal revenue 
A) due to improvements in technology 
B) assuming that technology is unchanged 
C) and output will rise 
D) unless barriers to entry are imposed 
E) until they equal marginal revenue

Question 4

Which of the following would be considered rent-seeking activity?

Accepted Answer

A) A software firm using lawsuits to drive competitors out of business. 
B) A technology firm investing in extremely expensive capital equipment. 
C) A large firm trying to charge lower prices than its competitors. 
D) An auto manufacturer using features and styling to differentiate its models from its competitors'. 
A) A software firm using lawsuits to drive competitors out of business. 
B) A technology firm investing in extremely expensive capital equipment. 
C) A large firm trying to charge lower prices than its competitors. 
D) An auto manufacturer using features and styling to differentiate its models from its competitors'.

Question 5

A non-discriminating monopolist's marginal revenue curve lies below its demand curve because

Accepted Answer

A) economists put it there by convention 
B) in order to earn more profit,the monopolist must charge higher prices 
C) a monopolist gouges its customers 
D) in order to increase their profits,monopolists must produce in the inelastic range of the demand curve 
E) in order to increase the number of units sold,the firm must lower the price on all units sold 
A) economists put it there by convention 
B) in order to earn more profit,the monopolist must charge higher prices 
C) a monopolist gouges its customers 
D) in order to increase their profits,monopolists must produce in the inelastic range of the demand curve 
E) in order to increase the number of units sold,the firm must lower the price on all units sold

Question 6

The supply curve of a single-price monopolist

Accepted Answer

A) coincides with its marginal cost curve above its average total cost curve 
B) coincides with its marginal cost curve above its average variable cost curve 
C) is established by the government 
D) slopes downward due to substantial economies of scale 
E) does not exist 
A) coincides with its marginal cost curve above its average total cost curve 
B) coincides with its marginal cost curve above its average variable cost curve 
C) is established by the government 
D) slopes downward due to substantial economies of scale 
E) does not exist

Question 7

Which of the following is true for a monopolist that does not price discriminate?

Accepted Answer

A) P > MR because some revenue is lost from having to lower the price on all units sold B) P < MR because the monopolist must lower price to sell more output C) P = MR only at the profit-maximizing level of output D) P = MR because there are no close substitutes for the good E) P = MR because the firm faces a perfectly elastic demand curve A) P > MR because some revenue is lost from having to lower the price on all units sold B) P < MR because the monopolist must lower price to sell more output C) P = MR only at the profit-maximizing level of output D) P = MR because there are no close substitutes for the good E) P = MR because the firm faces a perfectly elastic demand curve

Question 8

A monopolist that does not price discriminate will set the output level where

Accepted Answer

A) P = MC 
B) P = MR 
C) TR = TC 
D) MR = MC 
E) P = ATC 
A) P = MC 
B) P = MR 
C) TR = TC 
D) MR = MC 
E) P = ATC

Question 9

The fact that a single-price monopolist must lower its price to sell more output explains why price exceeds marginal revenue.

Accepted Answer

A) True 
 B)False

Question 10

In which of the following markets are we most likely to find a monopoly?

Accepted Answer

A) Automobile production. 
B) Air travel. 
C) First-class mail delivery. 
D) Clothing production. 
A) Automobile production. 
B) Air travel. 
C) First-class mail delivery. 
D) Clothing production.

Question 11

A monopolist will always enlarge its revenues by selling more output.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following limits the price a monopolist charges?

Accepted Answer

A) patents 
B) copyrights 
C) competition from other firms 
D) market demand 
E) market supply 
A) patents 
B) copyrights 
C) competition from other firms 
D) market demand 
E) market supply

Question 13

-The profit-maximizing monopoly in Figure 10-6 will charge a single price of

Accepted Answer

A) $2.50 
B) $3.50 
C) $5.00 
D) $5.75 
E) $3.00 
A) $2.50 
B) $3.50 
C) $5.00 
D) $5.75 
E) $3.00

Question 14

All of the following conditions,except one,must exist in order for a firm to successfully practice price discrimination.Which is the exception?

Accepted Answer

A) The firm must be a price taker. 
B) The firm must be able to identify which customers are willing to pay more. 
C) The firm must be able to prevent the resale of its output by low-price customers to high-price customers. 
D) The firm must be able to charge higher prices to some customers without losing their business. 
E) The firm must be a price setter. 
A) The firm must be a price taker. 
B) The firm must be able to identify which customers are willing to pay more. 
C) The firm must be able to prevent the resale of its output by low-price customers to high-price customers. 
D) The firm must be able to charge higher prices to some customers without losing their business. 
E) The firm must be a price setter.

Question 15

-For the monopolist in Figure 10-19,marginal revenue from selling 4 units of output would be

Accepted Answer

A) $20 
B) $40 
C) $80 
D) $70 
E) 100 
A) $20 
B) $40 
C) $80 
D) $70 
E) 100

Question 16

Patents allow manufacturers to block the entry of new firms into an industry through

Accepted Answer

A) infringement suits 
B) economies of scale 
C) limit pricing 
D) price discrimination 
E) a government franchise 
A) infringement suits 
B) economies of scale 
C) limit pricing 
D) price discrimination 
E) a government franchise

Question 17

Intellectual property includes

Accepted Answer

A) all of the following 
B) literary,artistic and musical works,and scientific inventions 
C) computers,calculators,and word processors 
D) desks,bookshelves,and notebooks 
E) office space,computers,and telephones 
A) all of the following 
B) literary,artistic and musical works,and scientific inventions 
C) computers,calculators,and word processors 
D) desks,bookshelves,and notebooks 
E) office space,computers,and telephones

Question 18

The demand curve that a monopolist faces

Accepted Answer

A) is steeper than the market demand curve 
B) is the same as its marginal revenue curve 
C) is controlled by the government 
D) does not exist 
E) is the same as the market demand curve 
A) is steeper than the market demand curve 
B) is the same as its marginal revenue curve 
C) is controlled by the government 
D) does not exist 
E) is the same as the market demand curve

Question 19

Monopolies may earn zero economic profit because of

Accepted Answer

A) zero marginal cost 
B) barriers to entry 
C) patents and copyright laws 
D) economies of scale 
E) government price regulation 
A) zero marginal cost 
B) barriers to entry 
C) patents and copyright laws 
D) economies of scale 
E) government price regulation

Question 20

If a firm is able to charge each customer the maximum amount that he or she is willing to pay for its good,

Accepted Answer

A) the firm is engaging in rent-seeking behavior 
B) profits for the firm will be lower than for a single-price monopolist 
C) the firm will be violating federal law 
D) this is perfect price discrimination 
E) barriers to entry into the market will fall 
A) the firm is engaging in rent-seeking behavior 
B) profits for the firm will be lower than for a single-price monopolist 
C) the firm will be violating federal law 
D) this is perfect price discrimination 
E) barriers to entry into the market will fall

Monopolies charge

-The firm in Figure 10-15 has

If a perfectly competitive industry is taken over by a monopolist,the market price will rise

Which of the following would be considered rent-seeking activity?

A non-discriminating monopolist's marginal revenue curve lies below its demand curve because

The supply curve of a single-price monopolist

Which of the following is true for a monopolist that does not price discriminate?

A monopolist that does not price discriminate will set the output level where

The fact that a single-price monopolist must lower its price to sell more output explains why price exceeds marginal revenue.

In which of the following markets are we most likely to find a monopoly?

A monopolist will always enlarge its revenues by selling more output.

Which of the following limits the price a monopolist charges?

-The profit-maximizing monopoly in Figure 10-6 will charge a single price of

All of the following conditions,except one,must exist in order for a firm to successfully practice price discrimination.Which is the exception?

-For the monopolist in Figure 10-19,marginal revenue from selling 4 units of output would be

Patents allow manufacturers to block the entry of new firms into an industry through

Intellectual property includes

The demand curve that a monopolist faces

Monopolies may earn zero economic profit because of

If a firm is able to charge each customer the maximum amount that he or she is willing to pay for its good,

What Is Economics

Scarcity, choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

Elasticity

Consumer Choice

Production and Cost

How Firms Make Decisions: Profit Maximization

Perfect Competition

B:Perfect Competition

Monopolistic Competition and Oligopoly

Labor Markets

B: Labor Markets

Capital and Financial Markets

Economic Efficiency and the Competitive Ideal

Governments Role in Economic Efficiency

Comparative Advantage and the Gains From International Trade

Filters

Exam 11: Monopoly

Monopolies charge

-The firm in Figure 10-15 has

If a perfectly competitive industry is taken over by a monopolist,the market price will rise

Which of the following would be considered rent-seeking activity?

A non-discriminating monopolist's marginal revenue curve lies below its demand curve because

The supply curve of a single-price monopolist

Which of the following is true for a monopolist that does not price discriminate?

A monopolist that does not price discriminate will set the output level where

The fact that a single-price monopolist must lower its price to sell more output explains why price exceeds marginal revenue.

In which of the following markets are we most likely to find a monopoly?

A monopolist will always enlarge its revenues by selling more output.

Which of the following limits the price a monopolist charges?

-The profit-maximizing monopoly in Figure 10-6 will charge a single price of

All of the following conditions,except one,must exist in order for a firm to successfully practice price discrimination.Which is the exception?

-For the monopolist in Figure 10-19,marginal revenue from selling 4 units of output would be

Patents allow manufacturers to block the entry of new firms into an industry through

Intellectual property includes

The demand curve that a monopolist faces

Monopolies may earn zero economic profit because of

If a firm is able to charge each customer the maximum amount that he or she is willing to pay for its good,

What Is Economics

Scarcity, choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

Elasticity

Consumer Choice

Production and Cost

How Firms Make Decisions: Profit Maximization

Perfect Competition

B:Perfect Competition

Monopolistic Competition and Oligopoly

Labor Markets

B: Labor Markets

Capital and Financial Markets

Economic Efficiency and the Competitive Ideal

Governments Role in Economic Efficiency

Comparative Advantage and the Gains From International Trade

Filters